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IV. TRADE POLICIES, BY SECTOR 
(1) OVERVIEW  
1. The agricultural sector makes an important contribution to Guatemalan employment and 
GDP.  It receives a limited amount of aid, including through tariffs and certain subsidies.  Guatemala's 
WTO Schedule of Commitments includes tariff quotas for 22 agricultural products, but tariff quotas 
are applied only to imports of rice, wheat flour, ye llow maize (corn) and apples.  Quotas are activated 
only in the event of a domestic market shortf all, although Guatemala normally imports volumes 
greater than those bound. 
2. The manufacturing sector generates most of Guatemala's merchandise exports, clothing 
industry exports being particularly important;  th ese are sold mainly on the United States market 
where a more keenly competitive envi ronment has caused the industry to flag.  For the most part, this 
and other external market-oriented industries opera te within the context of the in-bond processing 
(maquila) and free zone regimes.  The tax concessions  thus provided would not appear to be the best 
way of overcoming such domestic obstacles to comp etitiveness as the high costs of electricity and 
maritime transport. 
3. The hydrocarbons and mining sectors make only a modest contribution to GDP, although 
mineral exports have been increasing.  In mid-2008,  a draft mining law was in the process of being 
prepared.  The electricity sector was restructured and privatized during the 1990s.  However, there 
have been difficulties in satisfying domestic demand  and the average market price of electricity has 
risen until it is now one of the highest in the Americas. 
4. The services sector contributes almost 60 per cent of GDP and generates some two thirds of 
total employment.  Guatemala's Schedule of Speci fic Commitments annexed to the GATS is limited 
in scope, since it includes commitments in only 5 of the 12 categories of services.  Guatemala has 
adopted most of the commitments under the Fourth  Protocol on Basic Telecommunications Services 
but has not participated in the negotiations on fina ncial services.  Guatemala could make its legal 
framework more predictable by extending its mu ltilateral commitments, which would close the gap 
between its commitments and the present regulatory framework, which has been undergoing liberalization both independently and within the context of DR-CAFTA. 
5. The banking sector experienced serious difficulties in 2006 and 2007 and has been 
undergoing a phase of regrouping and consolidation in  2008.  Guatemala has strengthened the legal 
and institutional framework of its financial system, but further measures would appear to be needed.  
There are no restrictions on foreign commercial pr esence in the banking sector, but foreign insurance 
companies must set up a subsidiary in Guatemala in order to be able to offer services there, foreign 
firms being prohibited from establishing branches or agencies.  In mid-2008, a new insurance law was 
being discussed in Congress. 
6. Since the privatization of the telecommunications sector, the number of mobile telephone 
lines has increased considerably.  The law does not impose any restrictions on foreign investment.  
The historical operator continues to play a domin ant role in fixed tele phony and remains the second 
largest provider of mobile telephony services.  Ther e is a need to strengthen the regulatory body and 
perhaps for greater competition in some parts of the market.  The regulatory framework has been 
amended as a result of the commitments assumed by Guatemala under DR-CAFTA. 
7. Since its last Review, Guatemala has done more to open up the air transport sector.  Since 
2004, companies that provide domestic air transport services may be wholly foreign-owned, although WT/TPR/S/210/Rev.1 Trade Policy Review 
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they must have the principal corporate domicile in the country.  Guatemala has 11 bilateral air 
transport agreements, three of which are "open skies". 
8. Guatemala has no legislation dealing specifically with maritime transport.  There are no 
restrictions on foreigners with rega rd to the operation of ports or the provision of auxiliary services.  
However, in practice, the State owns all the seapor ts, one of which is privately managed.  A World 
Bank study has recommended certain reforms to facil itate private participation and reduce the cost of 
port services, and the authorities are developing a strategy for bringing them about. 
9. To provide professional services in Guatemala it is necessary to be a member of the 
corresponding professional association or "college".   Anyone with a professional qualification from a 
foreign university must have it revalidated by Guatem ala's national university.  To act as a notary, it is 
necessary to be Guatemalan by birth.  To practice architecture, Guatemalans must pay the College of 
Architects 1 per cent of their fees, whereas foreigners must pay 2 per cent. 
(2) AGRICULTURE  
(i) General characteristics 
10. The contribution of agriculture (including fishing but excluding agro-industry) to GDP fell 
from 13.9 per cent in 2001 to 11.3 per cent in 2006.  According to a survey carried out by the National 
Institute of Statistics in 2003, agriculture is directly  or indirectly responsible for 36.1 per cent of total 
employment, and there are some 822,000 agricultural holdings in the country.1  The average size of a 
farm in Guatemala is only 4.4 hectares;  45 per cent of all holdings are less than 0.7 hectares in size. 
11. Guatemala's agricultural sector can be divided in to three main activities:  those that have 
traditionally produced for export such products as co ffee, bananas, sugar, cardamom and berries;  
those that produce primarily for domestic consumpti on, especially maize (corn), beans and rice;  and 
those dedicated to non-traditional exports, such as fr uit and vegetables.  Guatemala provides a limited 
amount of aid for the agricultural sector, mainly through agricultural support and advisory services, technical training and infrastructure, and traditiona l products do not qualify for incentives such as 
those accorded under the maquila and free zone regimes. 
12. Coffee, sugar and bananas continue to be Gu atemala's main agricultural exports, although 
several other products have recorded much highe r rates of growth during the period under review 
(Table AIV.1).  Together, these three basic products  accounted for 18.3 per cent of total Guatemalan 
exports in 2007.  Cardamom is also considered  to be a traditional export.  Although cardamom 
production remained stagnant during most of the review period, there was a rapid increase in 
production in 2007.  The authorities expect that na tural rubber production will increase in the future 
and that Guatemala will become one of the worl d's main exporters of this product.  Most of 
Guatemala's natural rubber producers make use of the existing special regimes described in Chapter III(4)(iii). 
13. Coffee is Guatemala's principal agricultural expor t, followed by bananas and sugar.  During 
the period 2005-2008, the prices of these products were generally  higher than during the period 
2001-2004.  Sugar prices reached a maximum in 2006, while banana prices have been high since 2007.  During the period 2001-2004 coffee prices fluctu ated within a relatively narrow band but since 
then they have tended to rise. 
                                                     
 
1 Inter-American Institute for Cooperation in Agriculture (2007), p. 7. Guatemala WT/TPR/S/210/Rev.1 
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14. Guatemala is the world's fifth largest coffee exporter.2  During the period 2001-2007, annual 
coffee production fluctuated between 3.7 and 4.1 million 60-kg. sacks, of which some 300,000 sacks 
were for domestic consumption and the rest for e xport.  This represented a decline from the peak of 
4.9 million sacks exported in 2000, but the fall in vol ume was more than offset by the increase in 
price.  In 2006-2007, Guatemalan coffee prices we re about US$1 per pound, a much higher level than 
that achieved in the first years of the review pe riod.  In 2008, prices have continued to increase, 
reaching an average of US$1.45 per pound in April 2 008.  As a result of the higher prices, in 2007 the 
value of Guatemalan coffee exports was mo re than five times their value in 2001. 
15. Guatemala produces over 2 million tonnes of sugar a year, approximately two thirds of which 
is exported.  According to the authorities, most of  Guatemala's sugar exports do not benefit from any 
preferential regime, the exception being those c overed by DR-CAFTA and the FTA with Chinese 
Taipei.  Sugar is one of the two products excl uded from the scope of the CACM for Guatemala;  
imports from Central America must pay a tariff of 20 per cent. 
16. DR-CAFTA links preferential access for sugar to the United States with the trend and size of 
its sugar trade balance.  In 2006, Guatemala's trad e surplus in the sugar and sugar product sector was 
1,023,416 tonnes.3  Consequently, under the formula used for calculating access to the United States 
market contained in DR-CAFTA, in 2008 the total amount of Guatemalan sugar that can enter the 
United States duty-free is 33,280 tonnes.  This am ount should be added to Guatemala's allocation 
under the US global tariff quota;  in (US) fiscal year 2008, this corresponded to 50,546 tonnes.4  
Taking US imports of Guatemalan sugar as a whole,  the average tariff paid in 2007 was 4.7 per cent.  
The annual value of US sugar imports from Guatemala increased from US$38.1 million in 2001 to 
US$111.8 million in 2007 (including  96.9 million under DR-CAFTA).5  During the period under 
review, for solid sugar the unit value of exports fr om Guatemala to the Unit ed States fell slightly, 
from 33.9 US cents to 33.8 cents per kilo;  for liquid sugars the unit price rose from 9.5 cents to 
15.1 cents per litre. 
17. Guatemala produces a relatively small amount of ethanol, which is exported mainly to the 
United States.  According to an UNCTAD study, Guatemala has the capacity to develop its ethanol 
output, both for domestic use and for export.6 
18. Non-traditional agricultural exports include ve getables (broccoli, peas, lettuce, tomatoes, 
artichokes, red peppers, carrots), fruit (melons, papay as, bananas, plantain, pineapples, lemons and 
mango) and honey.  Exports of non-tr aditional products such as fruit,  vegetables and processed food 
grew rapidly during the review period, totalling US$282 million in 2007, a 45 per cent increase on the 
previous year.  It is estimated that, if present tr ends continue, fresh and prepared fruit exports could 
soon exceed those of bananas and become Guat emala's third agricultural export product. 
19. According to the 2003 Agricultural Census, ma ize (corn), black beans, grain sorghum 
(maicillo ) and sesame occupy 94.7 per cent of the area plan ted with annual crops.  However, yield is 
stagnant or falling.  Although rice yields have ri sen, production is declining due to reductions in the 
                                                      
2 Online information from the International Coff ee Organization.  Viewed  at:  http://www.ico. 
org/prices/m1.htm. 
3 USTR (2007), pp. 72392-72394. 
4 USTR online information.  Viewed at:  http ://www.ustr.gov/Document_Library/Press_Releases/ 
2007/August/USTR_Announces_FY_2008_Tariff-Rate_Quota_Allocations_for_Raw_Cane_ Sugar.html.  In the United States the fiscal year runs from 1 October to 30 September. 
5 Data estimated from US International Trade Commission figures.  The definition of sugar includes 
molasses. 
6 UNCTAD (2007). WT/TPR/S/210/Rev.1 Trade Policy Review 
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area cultivated.  Maize (corn) and rice are subject to import tariff quotas (see below).  In recent years, 
rice production has tended to decrease, falling from 45,200 tonnes in 2001 to 25,000 in 2007.  The 
authorities have attributed this decrease to several factors, such as low international prices, natural 
disasters, limited resources for providing agricultura l advisory services, phytosanitary problems, etc. 
(ii) Legal and institutional framework 
20. In Guatemala, it is the Ministry of Agri culture, Livestock and Food (MAGA) that is 
responsible for formulating and implementing policy in the agricultural sector.  In 2004, 
MAGA published its Agricultural and Sectoral Policy for 2004-2007, which lays  the foundations for 
the development of agriculture and the rural area s.  The general objective of this policy is to 
contribute to a sustainable improvement in the quality of life of the population that depends directly or 
indirectly on agriculture, through the promotion of competitiveness, support for small-scale farming 
and the husbanding and protection of  natural resources.  The management strategy establishes four 
priorities:  (i) fostering the productive and comme rcial development of th e commercial agriculture 
sector by encouraging increased investment and te chnological innovation along the entire length of 
the production chains with competitive potential;  (ii) promoting devel opment programmes that 
incorporate gender equality and recognition of the cu ltural diversity of the rural population engaged in 
small-scale (subsistence) farming;  (iii) prior itizing the use and sustainable supply of natural 
resources, by providing incentives for the proper use of the soil and developing programmes for its 
reclamation and conservation;  a nd (iv) strengthening the institutional structure of the agricultural 
sector, both public and private, by helping to create a climate that facilitates the action of the various 
sectoral entities. 
21. In accordance with the stated pr iorities of the Agricultural and Sectoral Policy, in 2006 the 
Government set up a Special Rural Development Offi ce to coordinate, guide and ensure the viability 
of government policies and programmes implem ented through the ministries and departments 
involved in the management of the country's rural development.7  By August 2008, the draft 
Agricultural Policy for 2008-2011 was in pr ocess of being analysed and approved. 
22. The interests of producers of export crops are s upported by private associations and research 
centres.  The Asociación Nacional del Café  – Anacafé (National Coffee Association) is a non-profit 
public institution that represents the interests of  the coffee growers.  In accordance with Decree 
No. 19-69, coffee exporters must obtain their expor t licences through Anacafé.  The authorities have 
noted that the purpose of the licences  is to ensure the quality of the product.  Under the legislation, 
Anacafé must not interfere with the free marketing of the coffee.  Decree No. 19-69 established the 
Coffee Policy Council as a body for the analysis, discussion and coordination of issues relating to the coffee market.  The main purpose of the Centro Guatemalteco de Investigación para la Caña de 
Azúcar  – CENGICAÑA (Guatemalan Sugar Cane Research  Centre) is to increase sugar yields and 
improve varieties through research programmes and capacity-building measures.  CENGICAÑA is 
financed by and subordinate to the Consejo Nacional de Asocia ción de Productores de Azúcar  – 
ASAZGUA (National Council of the Sugar Producers' Association).  The Asociación de Productores 
Independientes de Banano  – APIB (Independent Banana Producer s' Association) represents the 
interests of the banana producers. 
                                                     
 
7 Government Decision No. 471-2006. Guatemala WT/TPR/S/210/Rev.1 
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(iii) Policies in the agricultural sector 
(a) Tariffs and tariff quotas 
23. In 2008, the average level of tariff protection in  agriculture and fishing (ISIC definition) was 
8.1 per cent.  Average protection under the WTO de finition of agriculture was 9.9 per cent.  The 
agricultural products that benefited from the high est level of tariff protection included beverages 
(19.1 per cent), fruit and vegetables (13.2 per cent) , dairy products (13.2 per cent), animal products 
(12.3 per cent) and cereals (12.1 per cent). 
24. Guatemala applies tariff quotas to imports of sev eral agricultural products within the context 
of the minimum access commitments  undertaken in the Uruguay Round.  Guatemala's Schedule of 
Commitments includes tariff quot as for 22 agricultural products.8  In practice, the quotas for only 
four of these products have been activated.  Guat emala does not maintain tariff quotas for products 
other than those tariffied in the Uruguay Round, except in the context of DR-CAFTA.  The other 
18 products are subject to the MFN tariff, which is below the in-quota bound rate.  The authorities 
have pointed out that Guatemala nevertheless re serves the right to open tariff quotas for these 
products, if necessary. 
25. Quotas are distributed through import certificates, in the order in which applications are 
received.  If the volume requested  exceeds the specified quota, then the latter is distributed in 
proportion to the volume requested.9  There are quantitative ceilings per application.  Certificates are 
granted only to firms legally established in Guatemala and registered with the Ministry of the Economy.  They are awarded by ad hoc commission s whose membership includes the Ministries of 
the Economy, Agriculture, Livestock and Food, and Fi nance, and the Customs Directorate, together 
with representatives of the various branches of pr oduction.  Depending on the product to be imported, 
certificates are valid for from one to six months.  Ce rtificates are not allocated by country.  There are 
no domestic purchase and/or consumption requirements.  There are no cases of WTO quotas not being used as a consequence of bilateral agreements.  The authorities have poi nted out that, in general, the 
activation of tariff quotas depends on an actual shorta ge of certain products;  in this respect, quotas 
whose access conditions are better under bilateral agreements are not activ ated.  They have also stated 
that Guatemala has never activated unilateral quot as with tariffs lower than those established in 
Schedule LXXXVIII. 
26. In its latest notification to the WTO concerning tariff quotas, which covered 2004, 2005 and 
2006, Guatemala indicated that it was maintaining ta riff quotas for four products:  rice;  wheat and 
meslin flour;  yellow maize (corn);  and apples.
10  Table AIV.1 lists the products for which Guatemala 
                                                      
8 These are:  meat of bovine animals, fresh or chilled (HS 02.01);  meat of bovine animals, frozen 
(02.02);  meat of swine, fresh, chilled or frozen (02.03 );  meat and edible offal, of the poultry of heading 
No. 01.05, fresh, chilled or frozen (02.07);  milk and crea m, not concentrated or containing added sugar or other 
sweetening matter (04.01);  dried leguminous vegetables, shelled, whether or not skinned or split (07.13);  
grapes, fresh or dried (08.06);  apples, pears and quin ces, fresh (08.08);  soft wheat (1001.90.00);  maize 
(corn) (10.05);  rice (10.06);  grain sorghum (10.07);  wheat or meslin flour (1101.00.00);  soya beans, whether 
or not broken (12.01);  flours and meals of oil seeds or oleaginous fruits, other than those of mustard (12.08);  
soya bean oil and its fractions, whether or not refined, but not chemically modified (15.07);  palm oil and its fractions, whether or not refined, but not chemically modified (1 5.11);  sunflower-seed, safflower or cotton-seed 
oil and their fractions, whether or not refined, but not chemically modified (all products) (15.12);  maize (corn) 
oil (1515.2);  cane or beet sugar and chemically pure sucrose (17.01);  oil-cake and other solid residues, whether or not ground or in the form of pellets, resulting from  the extraction of soya-bean oil (23.04);  unmanufactured 
tobacco;  tobacco refuse (24.01).  See:  Schedule LXXXVIII, Guatemala. 
9 WTO document G/AG/N/GMT/22 of 17 October 2001. 
10 WTO document G/AG/N/GMT/33 of 5 April 2007. WT/TPR/S/210/Rev.1 Trade Policy Review 
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administers tariff quotas under the Agreement on Agriculture and likewise includes information on 
the tariff quotas for Guatemalan imports from the United States under DR-CAFTA.  Guatemala also 
has an activated yellow maize (corn) quota under the Mexico-Northern Triangle Free Trade 
Agreement.  The WTO quotas administered by the Ministry of the Economy for 2008 are:  rice in the 
husk, 25,200 tonnes;  wheat flour, 10,000 tonnes;  yellow maize (corn), 230,000 tonnes;  and apples, 
12,500 tonnes.11  The in-quota rates applicable range from zero to 15 per cent;  the out-of-quota tariffs 
applicable vary between 10 and 35 per cent. 
27. Quotas for the above-mentioned four products, to gether with poultry cuts, pig meat, beef, 
cheese, butter, ice-cream, powdered milk and ot her dairy products, are administered under 
DR-CAFTA (Table AIV.1).  Under DR-CAFTA, apart from pounded rice and poultry cuts, the quota 
utilization levels were higher in 2007  than in 2006, which mainly refl ects the fact that the tariff quotas 
were put into effect only during the second half of 2006. 
28. Most of Guatemala's free trade agreements  (FTA) expressly exclude various agricultural 
products.  At Central American le vel, imports of coffee, ethyl alcohol, sugar and wheat flour are 
subject to bilateral import regimes.  The FTA with  Mexico allows both countries to apply special 
safeguard measures to a list of specified agricultu ral products if imports of these products exceed 
certain levels.  The agreement also establish es an Agricultural Trade Committee that serves as a 
forum for negotiations and supervises trade in agricu ltural products between the two countries and the 
measures adopted.  The CACM's FTAs with Chile  and the Dominican Republic do not contain any 
special provisions concerning trade in agricultural products. 
(b) Subsidies and domestic support 
29. During the period 2001-2007, Guatemala su bmitted several notifications to the 
WTO Committee on Agriculture (Table AII.1).  Gu atemala notified the WTO that, between 2000 and 
2003 it had not applied any export subsidies subject  to reduction pursuant to Article 9.1 of the 
Agreement on Agriculture.12  Guatemala does not provide any subsidies or tax incentives for the 
production (apart from the programme described belo w), transport, marketing or consumption of 
agricultural products.  The Government does not fix th e prices of inputs for agricultural production or 
intervene in the marketing process.  Guatemala's most recent domestic support notifications were 
made in 2001.13  These mention programmes relating to agricultural support and extension services, 
technical training, infrastructure, etc. 
30. MAGA has a programme for selling fertilizer at below market prices to small and 
medium-sized agricultural producers.  In 2007,  the programme included the purchase by MAGA of a 
total of US$80 million worth of fertilizer, whic h was then made available to farmers;  
936,222 farmers benefited from the programme. 
31. Guatemala's agricultural sector also rece ives support from the FONAGRO and PROFRUTA 
funds, the aim of which is to modernize the country's agricultural production.  FONAGRO was 
established on 30 March 1994 by Government Deci sion No. 133-94 (as amended by Ministerial 
Decision No. 176-96) and has a capital endowment  of Q 500 million.  PROFRUTA, created by 
Ministerial Decision No. 540-99, is specially in tended to promote fruit, vegetable and legume 
production;  its budget for 2007 am ounted to Q 12 million.  Both funds provide technical and 
                                                      
11 MAGA online information.  Viewed at:  http ://portal.maga.gob.gt/portal/page/portal/uc_upie/ 
documentos/contingentes_2008.pdf. 
12 WTO documents G/AG/N/GMT/23 and G/AG/N/GMT/30 of 14 March 2003 and 26 May 2004. 
13 WTO document G/AG/N/GMT/26 of 18 August 2003. Guatemala WT/TPR/S/210/Rev.1 
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financial support for small agricultural producers.14  PROFRUTA also manages the PINFRUTA 
programme, with support from the Government of  Japan together with resources from the 
Government of Guatemala.  FONAGRO granted a to tal of Q 282.7 million (some US$37.2 million) in 
financing between 2002 and 2007 (Table IV.1). 
32. Guatemala has notified the Committee on Agricult ure that, in accordance with Articles 5.7 
and 8.2 of the Agreement on Agriculture, it did not take any special safeguard actions, whether 
volume-based or price-based, duri ng 2003.  As of September 2008, no notifications had been received 
with respect to subsequent years.15 
Table IV.1 
Financing provided by FONAGRO, 2002-2007 
(Q thousand) 
 2002 2003 2004 2005 2006 2007 2002-07 
Agriculture 23,407.3 21,812.9 11,455.4 19,621.2 9,428.4 11,309.6 97,034.8 
Services 3,261.2 16,073.5 49,750.0 15,849.3 18,774,5 600.0 104,308.5 
Livestock/crop farming 510.4 5,123.7 0.0 0.0 3,036.0 1,620.8 10,290.9 
Hydrobiology 14,935.6 1,034.0 1,307.5 0.0 597.2 3,514.8 21,389.1 
Management 0.0 15,092.2 15,847.0 0.0 0.0 6,000.0 36,939.2 
Communal banks 0.0 300.0 0.0 5,000.0 2,300.0 3,500.0 11,100.0 
Beekeeping 1,191.6 393.0 0.0 0.0 0.0 0.0 1,584.6 
Total 43,306.0 59,829.4 78,359.8 40,556.7 34,136.0 26,545.2 282,733.1 
Source : Information provided by the Guatemalan authorities. 
(3) MANUFACTURING  
33. In 2007, the manufacturing sector contributed 18.5 per cent to GDP, if agro-industry is 
included (12.5 per cent if it is not), as compared  with 19.7 per cent in 2001.  The subsector 
manufacturing textiles and clothing, leather and foot wear alone accounted for 4.7 per cent of GDP in 
2006.  Moreover, in 2006, the sector employed 17.2  per cent of the labour force, as against 20.8 per 
cent in 2001.  The made-up clothing industry accounts for most of Guatemala's manufacturing 
exports, but these exports have declined in ab solute and relative terms since the multilateral 
liberalization of the sector in 2005 and the conseq uent elimination of quotas.  However, Guatemala 
continues to export fabrics, thread and yarn, mainly  to the United States.  Exports from certain other 
manufacturing subsectors, such as metals and gla ss products, have recorded solid growth in recent 
years, but continue to account for a re latively small proportion of total exports. 
34. In 2007, Guatemala exported manufactured prod ucts valued at US$4,515 million, of which 
1,366 million were articles of clothing, 7.9 per cent less than in 2005.  Exports of chemical products 
totalled US$652 million and exports of other semi -manufactured goods 352 million.  Some 40 per 
cent of exports of manufactured products were c overed by Decree No. 29-89 (Law on the Promotion 
and Development of Exporting and Maquila Activities) or Decree No. 65-89 (Free Zones Law).  The 
main imports were machinery, vehicles, chemi cal products and processed mineral products (mainly 
fuel).  In 2007, Guatemala imported manufactur ed products valued at some US$9,900 million.16  In 
2007, the companies benefiting from the free zone  and maquila regimes imported a total of 
                                                      
14 For more information about PROFRUTA see:  http://www.profruta.gob.gt/index.php?option=com_ 
frontpage&Itemid=1. 
15 WTO document G/AG/N/GMT/29 of 10 March 2004. 
16 Information provided by the Bank of Guatemala.   Viewed at: http://www .banguat.gob .gt/estaeco/. WT/TPR/S/210/Rev.1 Trade Policy Review 
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US$1,700 million in raw materials and US$210 million in equipment.  The biggest importer was the 
clothing industry. 
35. In the WTO, Guatemala has been one of the c ountries to take the position that the completion 
of the process of integration of the textile and clothing sector into the rules and disciplines of 
GATT 1994 is of great systemic value for strengthening the multilateral trading system.17 
36. Guatemala's exports of clothing and other manuf actured products benefit from the preferential 
regimes of other countries, notably the United States.  Up to the middle of 2006, most clothing exports entered the United States under the terms of  the Caribbean Basin Initiative (CBI) and since 
then they have entered under DR-CAFTA.  Under both the CBI and DR-CAFTA, preferential 
treatment depends on compliance with rules of origin  that tend to restrict the sources of supply of 
fibres and fabrics.  The preferential arrangements ha ve helped Guatemala and other Central American 
countries to increase their exports to the United States while many other competitors have been 
subject to quotas imposed under the Multifibre Agre ement, the last of which expired in 2005.  
Clothing exports to the United States rose to th eir highest level in 2004, when they exceeded 
US$1,500 million.  Since then, despite DR-CAFTA, leve ls have fallen.  As the main sectors for taking 
advantage of DR-CAFTA, Guatemala is promoting those which because of their competitiveness tend 
to be attractive on the United States market.  Th e sectors identified so far are food, canned goods, 
beverages, plastics and cosmetics. 
37. Support for the manufacturing sector is provided mainly through incentives granted under the 
Free Zones Law and the Law on the Promotion a nd Development of Expor t and Maquila Activities 
(Chapter III(4)(iii)).  Based on the ISIC definition,  the average tariff for the manufacturing sector was 
5.8 per cent in 2008;  based on the WTO definition for non-agricultural activities, the average tariff in 
2008 was 5.3 per cent.  In addition to tariff protection and the special  export regimes, the measures for 
promoting industrial development include business de velopment programmes, assistance for research 
and aid for export marketing. 
(4) H
YDROCARBONS AND MINING  
(i) Overview 
38. In 2006, petroleum and mining accounted for only 0.3 per cent of total employment and 
0.5 per cent of GDP in Guatemala.  The value of petroleum exports increased steadily throughout the 
review period, while exports of other minerals ro se sharply during 2006-2007.  Petroleum and other 
minerals accounted for 14.6 per cent of Guatem ala's general exports in 2007 (Table AI.1). 
39. According to Article 121 of the Constitution, the subsoil and its hydrocarbon deposits and 
minerals, together with any other organic or i norganic substances found in the subsoil, are the 
property of the State, and Article 125 requires th e State to create favourable conditions for the 
exploration, exploitation and ma rketing of hydrocarbons, minerals  and other non-renewable natural 
resources.  There are no specific sectors or geographical areas reserved for exploitation by the 
Government or State-owned enterprises.  Mini ng rights are allocated by competitive bidding. 
(ii) Petroleum and refined products 
40. At the beginning of 2006, Guatemala had oil reserves estimated at 526 million barrels.  In 
2006, Guatemala produced 16,144.8 barrels of oil pe r day, while consumption of petroleum and 
petroleum products was 73,124 barrels per day.  Fo ssils fuels are used to produce approximately half 
                                                      
17 WTO document G/C/W/495 of 29 September 2004. Guatemala WT/TPR/S/210/Rev.1 
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the energy generated in Guatemala, and half of th ese fuels are used for transport.  In September of 
2008 it was planned to hold an auction, including offs hore concessions in the Pacific basin, during the 
last quarter of 2008. 
41. The authorities have pointed out that Guatemal a does not have the capacity to process all its 
crude since it has only one mini-refinery (La Libert ad), in process of expansion since 2002, which 
produces about 500,000 barrels of asphalt, diesel a nd other refined products a year.  Guatemala 
exports small quantities of asphalt (46,380 barrels in 2007), as well as some gasoline and diesel oil, 
but retains most of its production for domestic use.   Most of Guatemala's crude oil is exported to 
refineries in the United States, and Guatemala is a net importer of petroleum products.  In 
September 2008, there were two liquid petroleum ga s storage terminals, as well as 45 storage and 
bottling plants and a furthe r plant under construction.18 
42. The Ministry of Energy and Mining (MEM) is the national institution responsible for 
regulating the hydrocarbon sector.  Within the MEM,  the petroleum sector, including oil exploration 
and exploitation, is supervised by the Directorat e-General of Hydrocarbons.  The Directorate is the 
entity responsible for issuing licences for the following:  opening service stations;  importing;  
exporting;  operation;  installation;  refining an d processing;  opening asphalt plants;  storage;  and 
blending.  The requirements for applying for th ese licences can be found on the MEM's website.19  
The National Petroleum Commission, established by th e Hydrocarbons Law, is the advisory body for 
questions relating to exploration and exploitation contracts and the setting of crude oil export prices. 
43. Petroleum prices have been deregulated sin ce 1997, under the Hydrocarbons Marketing Law.  
According to UNCTAD, in Guatemala "the liberalization process in the market of liquid products is 
progressing more than in any other Central American  country" due to Guatemala's being "the most 
important market in the region and having lower en try barriers, which enabled various independent 
importers … to organize better pricing policy in the market".20 
44. The Hydrocarbons Law (Decree No. 109-83, as amended by Decree No. 161-83) of 
15 September 1983 and its Gene ral Regulations, the Regulati ons on Tender Procedures for 
Hydrocarbons Exploration and Exploitation Cont racts (Government Decision No. 754-92), the 
Invitation to Bid for Hydrocarbons Exploration and Exploitation Contracts (Government Decision 
No. 764-92) and the Regulations for Contractors and Subcontractors in the Petroleum Services Sector 
(Government Decision No. 299-84) constitute the main  legislation relating to hydrocarbons.  Matters 
relating to the marketing and importation of hydrocarbons are governed by the Hydrocarbons 
Marketing Law (Decree No. 109-97) of 26 Nove mber 1997 and its Regulations.  Under the 
Hydrocarbons Marketing Law, any natural or lega l person may import or sell petroleum products.  
The corresponding Regulations do not specify any na tionality requirements for obtaining licences or 
establish differential treatment for foreign-owned enterprises.  The Marketing Law provides for the 
imposition of sanctions if enterprises adopt antic ompetitive measures such as, for example, price 
fixing agreements.  The Hydrocarbons Law pr ovides for the possibility of production-sharing 
arrangements between the State and the contractor.  In these cases, the State's share of net production 
must amount to at least 30 per cent. 
45. Under Decree No. 38-92 of 1 July 1992 (as amended by Decrees No. 11-2003 and 
No. 38-2005), crude oil and fuels are subject to a specific tax.  In July 2008 this tax was Q 4.70 per gallon for 95 octane gasoline, Q 4.60 per gallon for 88 octane gasoline and Q 1.30 per gallon for 
                                                     
 
18 Online information from the Ministry of Energy and Mining.  Viewed at:  http://www.mem.gob.gt 
/portal/Home.aspx?tabid=2 2  http://www.mem.gob.gt/p ortal/Home.aspx?secid=81. 
19 Ibid.  Viewed at:  http://www.me m.gob.gt/portal/Home.aspx?secid=34. 
20 UNCTAD (2005a), p. 15. WT/TPR/S/210/Rev.1 Trade Policy Review 
Page 82 
 
 
diesel.  In 2007, total State income from pe troleum production was US$100.1 million, 11.7 million 
more than in 2006, of which US$13.9 million w as attributable to royalties, 78.5 million to 
production-sharing arrangements, a nd 7.6 million to direct income.21  Power stations that use crude oil 
or fuels to generate electricity are exempt from the payment of this tax. 
(iii) Mining 
46. Mining accounted for 0.5 per cent of GDP in 2006.  Guatemala produces materials such as 
baryta, clay, feldspar, gypsum, limestone, pumice stone, and building materials, mostly for domestic use.  Exports of mining products amounted to US$127.5 million in 2006, a sharp increase on the 
US$21 million exported in 2005.  The increase was the result of a substantial rise in exports of gold 
ore, which totalled US$98.6 million in 2006.
22 
47. Guatemala's mining sector is governed by Artic les 121 and 125 of the Constitution and by the 
Mining Law (Decree No. 48-97) of 11 June 1997 and its Regulations cont ained in Government 
Decision No. 176-2001.23  Article 121 of the Constitution stipul ates that the subsoil and its mineral 
deposits are the property of the State.  In Article 125 the scientific and rational exploitation of mineral 
resources is declared to be in the public interest.  Moreover, it is indicated that the State will establish 
and foster favourable conditions for their exploration, exploitation and marketing.24  At the beginning 
of 2008, work began on drafting a new mining la w based on a document approved in 2006 by the 
High-Level Commission set up by the President of the Republic. 
48. In the Law Establishing the Department of En ergy and Mining (Decree No. 57-78) published 
on 30 October 1978, it is stipulated that the Director ate-General of Mining is the agency responsible 
for studying, promoting, monitoring, supervising and inspecting everything concerned with mining 
and quarrying operations.  The Mining Law states that the Ministry of Energy and Mining is the 
authority responsible for formulating and coordina ting mining sector policies, plans and programmes, 
as well as for the implementation of the pr ovisions of the Law and its Regulations. 
49. The Mining Law applies to all mineral extr action operations, with the exception of those 
relating to hydrocarbons and substances dissolved in  underground waters.  Both Guatemalan nationals 
and foreigners may apply for mining concessions, th e procedure being the same in both cases.  There 
are no specific sectors or geographical areas reserved for the State or State-owned enterprises.  Mining rights in specific geographical areas are awarded on the basis of competitive bidding. 
50. To carry out mining activities it is nec essary to hold a licence granted by the 
MEM's Directorate-General of Mining.  There are three kinds of mining licence:  for surveying, for 
exploration and for exploitation.  The exploitation licence gives the holder the exclusive right to 
exploit the deposits in the area for which it was granted.   It is valid for a maximum period of 25 years, 
which may be extended for up to an equal period of time, at the request of the holder.
25  Between 2004 
                                                      
21 Directorate-General of Hydrocarbons (2008). 
22 MEM statistics.  Viewed at:  http://www.m em.gob.gt/Portal/Documents/Magazines/2007-06/682/ 
ImportacionesExportacion esProductsMineros.pdf. 
23 The Mining Law and its Regulations can be  viewed online at:  http://www.mem.gob.gt/ 
Portal/MEMDocuments/DGM/Ley/ley%20de%20mineria%20y%20su%20reglamento.pdf. 
24 MEM, Legal Framework.  Information view ed online at:  http://www.mem.gob.gt/Portal/ 
Documents/ImgLinks/2005-09/402/marco%20legal.pdf. 
25 MEM online information.  Viewed at:  http://www.mem.gob.gt/Portal/Home .aspx?secid=52. Guatemala WT/TPR/S/210/Rev.1 
 Page 83 
 
 
and 2006, the authorities granted two survey licen ces, 68 exploration licences and 51 exploitation 
licences.26 
51. Exploitation licence holders must pay royalties to the State for the extraction of mining 
products and to municipalities for the extraction of mi ning products within their jurisdiction.  Holders 
of mining rights must also pay various kinds of fees. 
(5) ELECTRICITY  
52. Article 129 of the Political Constitution of the Republic of Guatemala declared the 
electrification of the country to be a pressing national need.  Following the signing of the Peace Agreements of 1996, Guatemala embarked on a large-scale infrastructure renovation programme 
which included the restructuring and privatization of  the electricity and telecommunications sectors.  
Since then, Guatemala has increased its generating capacity and eliminated rationing.  It has been 
exporting electricity to El Salvador since 1986.  The process of reform in Guatemala involved the sale of the Empresa Eléctrica de Guatemala  – EEGSA (Guatemala Electricity Company), generating 
plants and other enterprises in the electrical energy sector. 
53. In 2006, Guatemala's electricity system produced 7,916.27 gigawatt-hours (GWh) of 
electricity, 41.3 per cent of which came from hydr oelectric plants, 32.2 per cent from steam turbines 
and 24.6 per cent from internal combustion engines (Table IV.2).
27  The State-owned enterprises 
accounted for 29.5 per cent of electricity generati on, while the remaining 70.5 per cent was produced 
by privately owned companies and other generato rs.  By type of subsystem, 93.9 per cent of 
generation employed the Interconnected System (SIN );  5.2 per cent came from non-utility producers 
(for their own consumption) and 0.9 per cent from isolated systems (Petén).  At the beginning of 
2008, there were 28 generators (27 private and 1 public);   3 transporters (one public and two private);  
18 private marketers;  and 3 private distributors.28 
Table IV.2 
Generation of electricity, 2006 
(GWh) 
Type of power station  Public Private Total 
Hydroelectric  2,313.12 957.04 3,270,16 
Steam turbine  0.0 2,550.61 2,550,61 
IC engine  0.0 1,944.51 1,944,51 
Geothermal  20.77 121.76 142,53 
Gas turbine  1.01 7.45 8,46 
Total  2,334.89 5,581.38 7,916.27 
Source : Ministry of Energy and Mining. 
54. Among the transmission companies, the State-owned Instituto Nacional de Electrification  – 
INDE (National Electrification Institute) occupies a do minant position in the system.  INDE continues 
to own and operate the national energy transport netw ork.  It also controls about half the generating 
stations (mainly hydroelectric), but competes wi th the independent producers that control the 
remaining capacity (mainly thermal). 
                                                      
26 MEM online information.  Viewed at:  http://www.mem.gob.gt/Portal/Documents/Magazines/2007-
06/682/LicenciasMinerasOtorgadas.pdf. 
27 Ministry of Energy and Mining (2007). 
28 A complete list of electrical subsector enterprises can be viewed at:  http://www.mem.gob.gt 
/Portal/Documents/ImgLinks/2005-11/492/ACTUALIZACI%C3%93N%20AGENTES.pdf. WT/TPR/S/210/Rev.1 Trade Policy Review 
Page 84 
 
 
55. Since Guatemala's last Review, the privatization of the distributors DEOCSA and DEORSA 
has been completed:  the Spanish company UNI ÓN FENOSA bought 80 per cent of the shares and of 
the remainder 7 per cent was purchased by the empl oyees, 5 per cent was put up for sale on the local 
market and 8 per cent is still in State hands.  The State still owns 14.2 per cent of the shares in the 
third distributor EEGSA.  The authorities have noted that in neither case has a date been set for the 
sale of the shares owned by the State. 
56. One benefit of electricity sector reform has b een the rapid rise in capacity and coverage.  
Total coverage in 2006 was 85.1 per cent.  However,  the World Bank has also drawn attention to the 
slow increase in coverage in recent years, which it a ttributes to the lack of funds for the electrification 
programmes and the sluggishness of the distributors;  the World Bank has recommended the 
Government to channel resources into expanding electrical coverage for the population without 
services, to improve the regulatory framework in or der to offer incentives for long-term investment 
and the efficient use of energy, and to establish decision-making and financing mechanisms to facilitate centralized and decentralized solutions for the provision of electricity to households that still 
lack this service.
29  The authorities estimate that, if these investments were made, coverage could rise 
to 89.9 per cent by the end of 2010. 
57. Guatemala runs a net surplus in trade in electri city with its neighbours;  in 2006 it imported 
and exported 8.4 and 88.2 GWh, respectively.  Accord ing to the authorities, exports have been falling 
as a result of increased domestic demand. 
58. The three institutions responsible for regula tion in the electricity sector are:  the Comisión 
Nacional de Energía Eléctrica  – CNEE (National Commission for Electrical Energy), the 
Administradora del Mercado Mayorista  – AMM (Wholesale Market Administrator) and the MEM.  
Policy formulation for the energy sector is in the hands of the MEM.  The General Electricity Law 
established the CNEE as the regulatory authority entrusted, inter alia , with supervising the application 
of the Law, drafting technical regulations for the electrical sector and setting tariffs for the regulated transmission and distribution services.  The CNEE is  semi-autonomous;  technically it forms part of 
the MEM, to which it reports directly, but its budge t is financed with funds derived from a 0.3 per 
cent tax on the distributors' electricity sales.  Th e CNEE supervises the regulatory framework and at 
the same time defines technical standards and, where necessary, approves tariffs.  The 
AMM coordinates the operations of the generating co mpanies, international interconnections and the 
domestic transmission lines so as to minimize costs, in addition to setting transmission prices where 
they have not been established by contract. 
59. The main legislation governing the electricity sector, apart from Article 129 of the 
Constitution, includes the Electricity Law (Decree No. 93-96) of 6 October 1996 and its Regulations, 
Government Decision No. 256-97 of 21 March 1997.
30  The Electricity Law demonopolized the 
energy subsector, opening it up to full private-sect or participation and se parating its different 
activities.  Foreign investment is allowed in all forms of electricity generation (including 
hydroelectric), transmission and distribution. 
60. The General Electricity Law stipulates that electricity generation does not require State 
authorization.  Authorization is needed only for ge nerating stations and transmission lines that require 
the use of public property.  Electricity producer s with a generating capacity of more than 5 MW. 
wishing to engage in transmission or distribution mu st do so through a separate enterprise.  Electricity 
transmission in Guatemala consists of a main and a secondary system.  Ownership of the main system 
                                                      
29 World Bank (2004), p. 53. 
30 The texts of the Electricity Law and its Regul ations can be viewed on the MEM's website:  
http://www.mem.gob.gt/Por tal/Home.aspx?secid=15. Guatemala WT/TPR/S/210/Rev.1 
 Page 85 
 
 
is in the hands of the State and its operation is shared by the generators;  the secondary system 
belongs to the generators and is the means of inte rconnecting the generators with the main system. 
61. Local service providers are required to connect and supply electricity to any interested party 
within their area of jurisdiction.  There is nothing in the Law about different treatment for 
foreign-owned enterprises. 
62. The wholesale market is the basic mechanism for distributing energy production between 
generators and consumers.  Its administration is  the responsibility of the AMM, which organizes the 
energy delivery programme, sets short-term pric es for the transport of energy and guarantees its 
supply, coordinates the SIN, and administers comme rcial transactions on the wholesale market.  The 
CNEE monitors wholesale market trends; a summary  information bulletin on market activities and 
prices is published once a week.31 
63. Prices can be fixed freely, with the excepti on of the prices for the transmission and 
distribution of those services that are subject to CN EE authorization.  The prices for large consumers 
which participate in the wholesale market are determined  in that market.  With regard to the prices for 
smaller users, each distributor determines its ow n tariff, subject to CNEE approval.  Under the 
Electricity Law, tariffs must be calculated for each voltage level and consist of base tariffs and 
periodic adjustment formulas that reflect changes in  distribution costs.  The large users are free to 
negotiate contracts directly with gene rators or buy on the spot market. 
64. There is a subsidized social tariff, est ablished under the Social Tariff Law (Decree 
No. 96-2000), for low-income users;  the subsidy is paid on the fraction of consumption up to 
100 kWh.32  The Social Tariff Law provides for the difference in price as compared with the 
non-social tariff to be financed by INDE through funds allocated for this purpose by the State, since the Electricity Law does not permit cross subsidies in distribution tariffs, clearly stipulating that in no 
case may the costs attributable to the service provi ded for one category of users be recovered through 
the tariffs charged to other users.  The CNEE is th e entity responsible for issuing and determining the 
rules, methodology, procedures and energy source necessary for the implementation of the social 
tariff.  In April 2008, the average non-social tariff applied by the three distributors was Q 1.581/kWh. 
(US$0.20), whereas the social tariff was Q 1.2409/kW h. (US$0.16);  these tariffs are high compared 
with those of other countries in the region.
33  In this connection, the authorities have noted that the 
non-social tariff has risen sharply in recent years, by 60 per cent between 2002 and 2007, but that the 
increases in the social tariff have been smaller.  The tariff increases are largely due to higher oil 
prices. 
65. The distributors purchase electricity by open bi dding.  All the information relating to the 
bidding and award procedure is publicly accessible.  The use of the main and secondary transmission 
and transformer installations is subject to the paym ent of charges agreed between the parties.  All 
generators and importers of electrical energy conne cted to the SIN pay a charge for the use of the 
main system, per kW. of installed capacity connect ed.  At the secondary level, the charges depend on 
the specific uses which the generators make of the systems.34 
                                                      
31 CNEE information.  Viewed at:  http ://www.cnee.gob.gt/pdf/monitor-mercadeo/2008/. 
32 CNEE Decision No. 36/2004.  Viewed at: http ://www.cnee.gob.gt/pdf/resoluciones/2004/036-
2004.pdf. 
33 In Costa Rica's last trade policy re view it was reported that, in July 2006, the average price of a kWh. 
of electricity was US$0.07 for the re sidential end consumer and US$0.08 for the industrial user (WTO, 2006). 
34 Regulations of the Electricity Law.  View ed at:  http://www.cnee.gob.gt/pdf/marco-
legal/LEY%20GENERAL%20DE%20ELECTRICIDAD%20Y%20REGLAMENTOS.pdf. WT/TPR/S/210/Rev.1 Trade Policy Review 
Page 86 
 
 
66. Guatemala participates in the Regional Electric ity Market (MER), which provides a platform 
for commercial electricity transactions, short-term  trading and medium- and long-term contracts 
between participants.  The legal basis for the ME R is the Framework Treaty on the Central American 
Electricity Market, signed on 30 December 1996 between the Governments of Guatemala, 
El Salvador, Honduras, Nicaragua, Costa Rica and Pana ma.  The participants in the MER consist of 
companies that generate, transmit, distribute and ma rket electricity, and large consumers.  The MER 
is regulated by the Regional Electrical Interc onnection Commission and operated by the Regional 
Operating Entity.  The Network-Owning Enterpri se is the entity responsible for developing, 
designing, financing, building and maintaining an Electrical Interconnection System for the Countries 
of Central America. 
67. Guatemala also participates in the Guatemal a-Mexico Interconnection Project, the purpose of 
which, as far as Guatemala is concerned, is to augment the supply of energy to the Guatemalan 
electrical system while seeking to improve prices and increase security and quality in the provision of 
the service. 
(6) SERVICES  
(i) Multilateral and preferential commitments 
68. In Guatemala the services sector accounts for 58. 7 per cent of GDP and some two thirds of 
total employment.  Guatemala has been a net importer of services since 2004.  Exports of services totalled US$2,674.7 million in 2007, 52 per cent above the level recorded in 2001 
(US$1,758.5 million).  Imports totalled US$2,751.4 million in 2007,  106 per cent above the 2001 
level (US$1,329.8 million). 
69. Guatemala's Schedule of Specific Commitments  annexed to the WTO's General Agreement 
on Trade in Services (GATS) is limited in scope, since it includes commitments in only 5 of the 12 categories of services:  business services, communications services, tourism services, transport services and financial services (Table AIV.2).
35  In general, Guatemala's commitments under the 
GATS tend to strengthen the policy framework in  force at the time of the Uruguay Round 
negotiations and hence take no account of the auto nomous liberalization in which the country has 
been engaged since then.  In mo st cases, the changes recently intr oduced have resulted in the policy 
applied being more liberal than these commitments. 
70. Guatemala's final List of Article II (MFN) Exemptions excludes from MFN treatment all the 
sectors covered by:  the various CACM agreements36;  the Investment Guarantee Agreement with the 
United States (Decree No. 1,545 of 22 August 1962)  and its Regulations (Government Decree 
No. 693-86);  the Trade and Investment Agreemen t between Central America and Colombia and 
Venezuela signed on 12 February 1993;  and th e 1991 Tuxtla Gutiérrez Agreements between the 
Central American countries and Mexico.  These are indefinite measures whose main justification is 
the maintenance of preferences. 
71. Guatemala participated in the extended ne gotiations on telecommunications, revising its 
schedule of concessions accordingly.37  Guatemala has not ratified the Fourth Protocol, although it did 
participate in the negotiations, as a result of which the schedule of concessions was amended.  In this 
                                                      
35 WTO document GATS/SC/36 of 15 April 1994. 
36 The Central American Exception Clause does not permit the extension to third countries of the 
concessions granted to each other, bilaterally or  multilaterally, by the Central American States. 
37 WTO documents GATS/SC/36/Suppl.1 of 11 April 1997 and GATS/SC/36/Suppl.1/Rev.1 of 
29 November 1999. Guatemala WT/TPR/S/210/Rev.1 
 Page 87 
 
 
connection, the authorities have pointed out that Gu atemala has adopted the Fourth Protocol through a 
process of certification.  Guatemala did not par ticipate in the extended negotiations on financial 
services. 
72. Guatemala has submitted an initial offer within the context of the Doha Round negotiations 
on services.  As of August 2008, Guatem ala had not submitted a revised offer. 
73. Apart from Article XVII, which establishes the principle of national treatment for the 
construction industry, the General Treaty on Central American Econom ic Integration does not contain 
any provisions concerning national treatment in the services sector.  The Central American Treaty on 
Investment in Trade and Services, which guarantees national treatment for the provision of services in 
the region, was signed in March 2002 and its amendi ng protocol in February 2007.  Guatemala has 
ratified this treaty but, by September 2008, the amendi ng protocol had not yet entered into force.  The 
Free Trade Agreement with Mexico addresses matters  relating to services in Chapters X (general 
provisions and cross-border trade in services), XI (fi nancial services), XII (telecommunications), and 
XIII (presence of natural persons).  The treaty establishes the principles of MFN treatment and 
national treatment for the cross-border supply of services between the two countries and establishes a 
Committee on Cross-Border Trade in  Services and Investment with responsibility for monitoring 
compliance with the mutual commitments and for discussing issues relating to trade in services and 
investment.  The FTAs signed with in the framework of the CACM with the Dominican Republic and 
Chile establish the principle of MFN treatment for tr ade in services between the contracting parties. 
74. The authorities have also noted that Guatemal a maintains agreements on transport services 
with some of its regional trading partners.  Ther e is a regional agreement between Central America 
and Panama for the free transit of land freight transport.  This agreement makes possible free 
movement from Panama to Guatemala via the inter-American highway, with reservations for cabotage. 
75. The services provisions of DR-CAFTA are based on a negative list for liberalization.  The 
main horizontal exclusion in the agreement is for su pply under mode 4.  Guatemala has also adopted 
exceptions for various sectors (for example, to prac tise as a public notary an individual must be of 
Guatemalan nationality and domiciled in Guatemal a;  only Guatemalan nationals and foreigners 
resident in Guatemala can provide tourist guides ser vices).  With regard to services, the agreement has 
encouraged improvements to supply under mode 3,  commercial presence, with a view to attracting 
more foreign direct investment. 
(ii) Telecommunications 
(a) General characteristics and multila teral and regional commitments 
76. Guatemala participated in the Negotiating Gr oup on Basic Telecommunications but, due to 
changes in its General Telecommunications Law, was not  in a position to ratify the Fourth Protocol to 
the GATS immediately.  Guatemala subsequently submitted a revised schedule of commitments on 
telecommunications under the WTO certifica tion procedure, which concluded in 1999.
38  The only 
remaining limitation on market access  in this schedule is the requirement that international traffic 
must be routed through the facilities of an enterprise with a frequency user's title and/or 
Telecommunications Registration Certificate i ssued by the Telecommunications Supervisory 
Authority (SIT).  There are no limitations on national treatment.  Guatemala accepted the WTO reference paper on telecommunications unde r the conditions of the certification process. 
                                                     
 
38 WTO documents S/C/W/88 and S/C/W/128/Rev.1 of 11 December 1998 and 22 October 1999 
respectively. WT/TPR/S/210/Rev.1 Trade Policy Review 
Page 88 
 
 
77. Guatemala is a member of the Regional Technical Commission on Telecommunications 
(COMTELCA) between Guatemala, Costa Rica, Hondur as, El Salvador, Nicaragua and Panama, and 
is a signatory to the Central American Treaty on Telecommunications. 
78. The telecommunications sector was privatized during the 1990s.  Up to 1997, the fixed 
telephony market in Guatemala was dominated by th e State operator GUATEL.  As part of the public 
enterprise privatization process, in 1997 GUATEL's principal assets passed into the hands of 
Telecomunicaciones de Guatemala (TELGUA), whic h currently belongs to the operator América 
Móvil, established in Mexico.  The number of fixed lines has grown steadily, rising from less than 
1 million in 2001 to 1.4 million in 2006, while the number of mobile phones rose from 1 million to 
7.2 million.  Altogether, the number of telephone lines in Guatemala quadrupled during the review 
period (Table IV.3).  In June 2007, mobile tele phony subscribers numbered more than 9.2 million. 
Table IV.3 
Telephone lines in Guatemala, 2001-2006 
Product 2001 2002 2003 2004 2005 2006 Change 
2001-2006 
(%) 
Fixed lines 756,085 845,758 944,176 1,132,121 1,248,161 1,354,926 79.2 
  Percentage of total 39.7 34.9 31.7 26.3 21.7 15.9  
Mobile lines 1,146,423 1,528,148 2,034,777 3,168,256 4,510,067 7,178,745 526.2 
  Percentage of total 60.3 65.1 68.3 73.7 78.3 84.1  
Total 1,902,508 2,423,053 2,978,917 4,300,377 5,758,228 8,533,671 348.5 
Source : Information from the Telecommunications S upervisory Authority a nd own calculations. 
79. TELGUA, the country's largest fixed telecommunications operator with more than 
800,000 subscribers belongs to the operator América Móvil.  Claro, which also belongs to América 
Móvil, is Guatemala's second largest fixed te lecommunications operator with slightly over 
200,000 subscribers.  In December 2007, there were  three active mobile operators:  Millicom Tigo 
(some 4.3 million users), América Móvil Claro (some 4.5 million), and Telefónica Móviles MoviStar 
(some 3 million).  As of 31 December 2007, th ere were 50,990 public telephones provided by the 
main operators. 
80. The Government has given priority to the dissemination of information technology and 
telecommunications to rural areas and areas with poor service.  The strategy is aimed at encouraging 
the private sector to make available to each munici pality at least one broadband Internet access point 
and to ensure that all rural localities have at least one public telephone.  A fund, FONDETEL, 
financed from State resources, has also been established for the purpose of subsidizing the telephone 
service in low-income rural or urban areas.  Parties interested in receiving subsidies must submit specific telephony projects to FONDETEL.  FONDETEL analyses all investment projects, giving priority to those likely to yi eld a greater social return. 
81. Despite Guatemala's achievements in liberalizing telecommunications, a recent 
UNCTAD study observes that the objective of opening the sector to competition "has not been totally 
achieved and there is still need for more effect ive competition in the market of local or home 
telephony".
39  Although it acknowledges that there is more competition in mobile telephony, the study 
argues that, in fixed telephony, TELGUA re mains the dominant operator in the sector. 
82. A recent study sponsored by ECLAC notes that the reform of the telecommunications sector 
has produced excellent results, placing Guatemala' s long-distance prices am ong the lowest in the 
                                                      
39 UNCTAD (2005a), p. 14. Guatemala WT/TPR/S/210/Rev.1 
 Page 89 
 
 
world, as well as increasing the level of competiti on in various segments, thereby further improving 
the quality and coverage of the services.  The sa me study notes that the scheme for allocating the 
radio-frequency spectrum has been a success, but e xpresses some concern with regard to regulation 
and the promotion of competition, recommending th at the powers of intervention of the SIT be 
strengthened for the purpose of enforcing the la w, repressing anticompetitive practices and imposing 
sanctions.40 
(b) Institutions and regulatory framework 
83. Responsibility for supervising Guatemala's telecommunications market lies with the Ministry 
of Communications, Infrastructure and Housing.  The SIT, a functionally independent State 
organization established in November 1996 under the Ministry of Communications, Infrastructure and 
Housing, is entrusted with th e regulation of the sector and the implementation of the General 
Telecommunications Law.  The aim of the SIT is to build up a telecommunications services market with broad diversity and national c overage and to have these services  provided within a framework of 
open competition.
41  The SIT's activities include the admini stration of the radio-frequency spectrum 
and the Telecommunications Register.  The SIT is also responsible for authorizing satellite systems 
and related facilities, the national numberi ng plan and the national signalling plan.42  T h e  
Superintendente , the SIT's highest authority, is appointed by the Ministry of Communications, 
Infrastructure and Housing. 
84. Guatemala's telecommunications sector is govern ed by the General Telecommunications Law 
(Decree No. 94-96 and its amendments) of 17 Octo ber 1996, the Regulations for the Provision of 
International Telephone Services (Government Deci sion No. 408-99) of 25  June 1999, and the 
Regulations for the Exploitation of Satellite Systems in Guatemala (Government Decision 
No. 574-98) of 2 September 1998.43  The General Telecommunications Law changed the legal 
framework with a view to promoting privat e investment, innovation and competition in the 
telecommunications sector.  The General Teleco mmunications Law makes it possible to introduce 
competition into the provision of all tel ecommunications services.  The Law covers 
telecommunications and, in general, all services pr ovided through the radio -frequency system.  The 
Law does not call for the provision of a universal service but promotes the development of rural telephony on a voluntary basis, by granting the private operators access to FONDETEL resources. 
85. Licences for the use of frequency bands are granted through frequency user titles (TUF) 
acquired at public auctions organized by the SIT,  which are open to Guatemalans and foreigners on 
equal terms.  The licences are valid for 15 years.  There are no specific requirements for the allocation 
of licences, since under the model applied by Guat emala to the telecommunications sector it is the 
market that decides on the frequencies required, not the regulator.  Interested parties determine the 
frequencies that are occupied and those that are available and apply for those in which they are 
interested.  The Law states that if there is more th an one interested party, then an auction must be 
held.  TUFs are automatically renewable after 15 years, at the request of the licence holder.  
According to a study sponsored by ECLAC, this sy stem, by creating TUFs, eliminated the previously 
existing discretionary authority in the allocation of resources.
44 
                                                      
40 Urízar, Carmen (2007). 
41 Online information from the SIT.  Viewed at:  http://www.sit.gob.gt/. 
42 Further information about the activities of the SIT can be found at:  http://www.sit.gob.gt/. 
43 The text of the Telecommunications Law can be viewed at:  http://www.itu.int/ITU-
D/treg/Legislation/Guatemala/leygen.pdf. 
44 Urízar, Carmen (2007). WT/TPR/S/210/Rev.1 Trade Policy Review 
Page 90 
 
 
86. There is no regulation of prices for telecommunications services, even where there is not 
sufficient competition, except in the case of access to essential resources.  The contractual conditions 
of interconnection of commercial telecommunications networks ar e freely negotiated between the 
interested parties.  The Law does not provide for th e case in which the parties are unable to arrive at 
an agreement, except wher e essential facilities are concerned.  Th e Law stipulates that operators with 
more than 10,000 access lines must allow users connect ed to their network to choose the services of 
other operators free of charge.  Initially, the Law did not establish the concept of dominant operator, 
but was amended in this respect by Decree No. 11-2006 of 18 May 2006, whic h contains the legal 
changes to the Telecommunications Law and other legislation necessary for the implementation of 
DR-CAFTA.  There are no specific requirements with regard to national owners hip or management in 
the telecommunications sector.  The authorities have pointed out that number portability is possible, 
under the conditions laid down by law. 
87. In accordance with the Regulations for the Provi sion of International Telephone Services, all 
telecommunications network operators and internati onal interconnection agreements must be entered 
in the SIT Telecommunications Register.  Local network operators must guarantee their users access 
to international phone services.  The Regulations do  not contain any rules that discriminate between 
national and foreign network operators.  There is  no legal prohibition concerning the provision of 
call-back services. 
(iii) Financial services 
(a) General characteristics and multilateral commitments 
88. Guatemala has assumed limited commitments with regard to financial services under the 
GATS.  These relate solely to reinsurance of policies,  the supply and transfer of financial information, 
and financial advisory services (Table AIV.I).  The Guatemalan legislation allows the Superintendencia de Bancos  – SIB (Banking Supervisory Authority) to exchange information with 
other similar entities abroad for supervisory purposes.  In this connection, the authorities have noted 
that Memoranda of Understanding have been agreed with the regulatory authorities of 16 countries for 
the purpose of exchanging information concerning supervision. 
89. As of 31 December 2007, there were 122 entities operating within the Guatemalan financial 
system under the surveillance and inspection of the SIB, with total assets of Q 152,074.2 million 
(US$19,928.4 million), the equivalent of abou t 59.3 per cent of GDP (Table IV.4).  In 
December 2007, the banks owned 77.9 per cent of  the assets, finance companies 3.3 per cent and 
offshore entities 13.0 per cent. 
90. The SIB does not regulate securities firms, certain credit card firms or cooperatives.  These 
figures do not include the Bank of Guatemala.  Moreover, the operations of three banks and 
two finance companies are currently suspended pending the settlement of judicial proceedings.
45 
91. Guatemala's legislation distinguishes between di fferent types of financial institutions, all 
supervised by the SIB.  Banks are authorized to engage in banking financial intermediation, i.e. to 
carry out customarily, on a public or private basis, the activities of taking in money, or any instrument 
representative thereof, from the public, for example by accepting deposits or issuing bonds and other 
securities, and using it for some form of financing.  Other types of institutions include:  (a) finance 
companies;  (b) general deposit warehouses, which ar e private enterprises of the nature of auxiliary 
credit institutions set up as a Gu atemalan public limited company for the purpose of receiving on 
deposit, storing and safekeeping, handling and distributing, and buying and selling for the account of 
                                                      
45 Banking Supervisory Authority (2008). Guatemala WT/TPR/S/210/Rev.1 
 Page 91 
 
 
third parties goods or products of  domestic or foreign origin an d issuing title documents (bond or 
credit instruments) that cover the value of the good s deposited and the credit granted by an entity or 
person with the goods as security;  and (c) insurance companies. 
Table IV.4 
Composition of the financial system as of 31 December 2007 
 Number of 
enterprises Q million Assets as a 
percentage of 
total assets As a percentage of 
nominal GDP 
(2007) 
Banks 21 118,392.5 77.9 46.2 
Offshore entities 10 19,831.5 13.0 7.7 
Finance companies 16 4,951.3 3.3 1.9 
Insurance companies 17 3,593.8 2.4 1.4 
Bonding companies 11 471.8 0.3 0.2 
General deposit warehouses 15 194.4 0.1 0.1 
Securities firms 14 64.6 0.0 0.0 
Foreign exchange houses 1 8.9 0.0 0.0 
Othera 17 4,565.4 3.0 1.8 
Total 122 152,074.2 100.0 59.3 
a Includes nine credit card firms,  four leasing and factoring fi rms, one remittance firm, the In stitute for the Promotion of In sured 
Mortgages, the Pawnbroking Department of El Crédito Hi potecario Nacional de Guatemala, and Interconsumo S.A. 
Source : Banking Supervisory Authority.  The number of banks fe ll to 20 at the beginning of 2008 with the takeover merger 
of two institutions (http://www.sib.gob.gt/es/En tidades-Supervisadas/I nformes/JM_12-2007.pdf). 
92. Under Decree No. 26-9, the Law on the Financia l Products Tax, a 10 per cent tax is imposed 
on interest income of all kinds, including that from public or private securities, that is paid to, or 
credited to the account of, natural or legal persons , domiciled or established in Guatemala, not subject 
to the supervision of the SIB.46 
(b) Banks and other financial institutions, other than insurance companies 
General characteristics 
93. At the beginning of 2008, there were 20 banks operating in Guatemala.  Of these 19 were 
domestic and one foreign (C itiBank).  In the course of 2008, the Guatemalan banking system has been 
undergoing a phase of regrouping and consolidation.  In 2006, there were 23 banks operating in the 
country;  in 2008, the number has fallen to 20 as a result of two closures and one merger.  The Guatemalan financial sector is dominated by 11 fi nancial groups.  The five largest banks accounted 
for 51.8 per cent of total bank assets at the end of 2007 .  Out of the total deposits in credit institutions, 
including offshore entities, 27.7 per cent is denominated in US dollars. 
94. The banks have been taking steps to make ba nking services more accessible to the public, for 
example, by opening more branch offices.  In 2007, the total number of branch offices operated by all the banks in the system was 2,245, a significant increase over the 942 that existed in 2002.  The 
number of branch offices per 1,000 inhabitants ro se from 0.07 to 0.18 during the period 2002-2007.  
Moreover, the Guatemalan banking system plays an important role as a channel for the remittances 
sent home by workers, mainly from the United States , and these remittances, in their turn, constitute a 
potential source of growth for the banking system.  A World Bank study shows that most transfers of 
                                                     
 
46 The text of the Law can be viewed at:  http ://portal.sat.gob.gt/porta l/components/com_docman/ 
dl2.php?archive=0&file=ZHRvLTI2LTk1LmRvYw==. WT/TPR/S/210/Rev.1 Trade Policy Review 
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remittances to Guatemala from worker s in the United States are distributed in Guatemala through the 
banking system.47 
95. The average spread between lending and borrowing  rates has been gradually decreasing but is 
still relatively large.  From 13.3 per cent in 1995 it fell to 10.7 per cent in 2000, 9.6 per cent in 2004, 
and 8.25 per cent in May 2008.48 
96. The period 2006-2007 brought serious problems for the banking system.  In October 2006, 
the operations of what was then the country's f ourth largest bank (Banco del Café, S.A.) were 
suspended due to non-compliance with the pruden tial rules and the difficulties experienced by its 
offshore bank.  Subsequently, a specially appointed Assets and Liabilities Exclusion Board was set up 
for Banco del Café, S.A.  This Board transferred a ll deposits to three Guatemalan banks so that they 
could take care of the account holders and established a trust fund in a credit institution for the bank's 
total assets so that the debtors could fulfil their obligations.  In January 2007, the Monetary Board 
suspended Banco de Comercio, S.A., due to li quidity problems arising from overlending in the 
months of November and December 2006.  In this connection, a special Assets and Liabilities 
Exclusion Board was set up for the Banco de Comercio , S.A.  This transferred all deposits to another 
bank and established a trust fund in a credit institu tion for the assets of Banco de Comercio.  The 
authorities consider that these decisions taken by the Monetary Board protected the financial system from a run on the banks and thus safeguarded th e payments system.  However, these problems 
revealed some serious vulnerabilities in the sector, such as a lack of adequate information.  In order to 
deal with these vulnerabilities and strengthen supervis ion, the SIB set up a Special Investigation Unit 
to investigate fraudulent banking practices and financ ial intermediation activities being carried out by 
unauthorized entities, such as those detected in the case of an entity related with Banco de 
Comercio, S.A. and other illegal activities. 
97. According to the World Bank and the IMF, there is a need to strengthen supervision in 
Guatemala, as well as to improve the risk manage ment procedures of the financial institutions.  The 
World Bank is urging the approval and implementation of preliminary draft laws on the registration of 
property and collateralized transactions and the adopt ion of measures to improve transparency in the 
financial sector.  The World Bank has also invited th e SIB to establish addition al safeguards while it 
continues the process of rationalization of the banki ng sector and to bring about improvements in the 
internal systems of banks and finance companies.
49 
98. An IMF study found that even though there are few formal barriers, deficiencies in regulatory 
and competition standards and in the judicial sy stems still restrict the participation of foreign 
institutions in the financial systems of Central Am erica, including Guatemala.  The authors of the 
study found that a greater presence of such in stitutions could support trade and investment 
liberalization, though that would require adjustments in prudential supervision at national levels and 
greater cooperation between CAFTA members.  The barriers that the report identified in Guatemala 
include the requirement that 90 per cent of the em ployees of a financial ins titution must be local and 
that Guatemalan workers must r eceive 85 per cent of total wages.50  The authorities have pointed out 
that this is a horizontal measure applicable to al l types of enterprise and only for operatives, to the 
exclusion of senior executives and boards of directors. 
                                                      
47 Cheikhrouhou, et al.  (2006). 
48 Bank for International Settlements (2007). 
49 World Bank (2004). 
50 Canales-Kriljenko et al.  (2003). Guatemala WT/TPR/S/210/Rev.1 
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Regulatory framework 
99. The banking sector is supervised by the Banking  Supervisory Authority (SIB).  The SIB is a 
technical supervisory body which, operating under the general direction of the Monetary Board, 
Guatemala's foremost monetary policy authority,  monitors and inspects the Bank of Guatemala, 
together with the banks, finance companies, credit institutions, bonding firms,  insurance companies, 
general deposit warehouses, forei gn exchange houses, and financ ial groups and their holding 
companies, in accordance with the provisions of  Article 1 of the Law on Financial Supervision 
(Decree No. 18-2002).  The SIB enjoys functional independence in achieving its objectives. 
100. The SIB's mission is to promote stability and conf idence in the financial system it supervises.  
According to the authorities, it aims to be an in stitution of recognized credibility that effectively 
supervises the companies it is responsible for moni toring and inspecting, complies with international 
standards, and serves society responsibly and transp arently, with an appropriate capacity to respond. 
101. The functions of the Bank of Guatemala include  ensuring that the banking system maintains 
an adequate level of liquidity, through the use of  the instruments for which its organizational law 
provides;  ensuring that the payments system functions properly;  and receiving on deposit the necessary bank reserves and statutory deposits required by its organizational law. 
102. Since the last review of its trade policy, Guat emala has strengthened th e legal and institutional 
framework of its financial system with five new laws: the Law against the Laundering of Money and 
Other Assets (Decree No. 67-2001), the Organizational Law of the Bank of Guatemala (Decree No. 
16-2002), the Monetary Law (Decree No. 17-2002) , the Law on Financial Supervision (Decree No. 
18-2002), and the Law on Banks and Financial Groups (Decree No . 19-2002).  These laws have 
enabled the authorities to begin registering and s upervising the offshore banks and take steps to 
initiate the consolidated supervisi on of financial conglomerates.  Th e authorities have also reinforced 
the supervision of the payment systems.  Other relevant laws include: the Law for Preventing and 
Repressing the Financing of Terrorism (Decree No. 58-2005), the Law on Free Trading in Foreign 
Exchange (Decree No. 94-2000), the Law on the Securities and Commodi ties Market (Decree 
No. 34-96), the Currency Law (Decree No. 136- 96), the General Law on Cooperatives (Decree 
No. 82-78), and the Law on Private Financial Co mpanies (Decree No. 208).  Apart from this 
legislation, Guatemala's banking sector is governed by the decisions issued by the Monetary Board. 
103. The Law on Banks and Financial Groups (Decree No. 19-2002) contains the legal framework 
governing matters relating to the establishment, organization, merger, activities, functioning, 
suspension of operations and liquidation of banks and financial groups, as well as to the opening and 
closing of branches, subsidiaries and representativ e offices of foreign banks.  The Monetary Law 
guarantees the free movement of capital and the free ex ternal convertibility of the national currency.  
The Law on Financial Supervision authorizes the supervisory body to exercise consolidated 
supervision, covering all the companies that make up  a financial group, in order that the risks which 
they assume and which could affect the group's bank may be properly assessed and monitored.  
Moreover, it grants the supervisory body the power  to impose sanctions.  The Law on Free Trading in 
Foreign Exchange, in force since 2001, allows cred it institutions to hold and deal in any foreign 
currency. 
104. The Law on Banks and Financia l Groups stipulates that persons acquiring, directly or 
indirectly, a holding equal to 5 per cent or more  of a bank's paid-up capital must have the 
authorization of the SIB.  Under the Law, the bank s are free to negotiate with users interest rates, 
commissions and other charges applicable to their operations and services.  The Law governs 
concentrations of investment by the banks.  In th is respect, it stipulates that, with the exception of WT/TPR/S/210/Rev.1 Trade Policy Review 
Page 94 
 
 
financial operations with the Bank of Guatemala a nd the Ministry of Finance, banks and finance 
companies may not carry out operations that involve direct or indirect financing which, in total, exceeds 15 per cent of the assets attributable to a sing le private natural or legal person or to a single 
State-owned or autonomous enterprise or entity, or 30 per cent in the case of two or more related or 
associated persons forming part of a single risk uni t.  The banks are not required to devote part of 
their resources to specific activities.  The Law on Free Trading in Foreign Exchange establishes the 
freedom to dispose of and hold foreign currencies and to  contract, remit, transfer, buy, sell, charge and 
pay in them, and allows natural a nd legal persons, whether Guatemalan or foreign, to make deposits in 
and obtain loans from banking entities established abroad , either directly abroad or in Guatemala, 
through locally registered representative offices. 
105. The Law on Banks and Financial Groups also includes provisions for regulating financial 
groups, defined as a grouping of two or more legal pe rsons engaged in activities of a financial nature, 
one of which is a bank.  The Law stipulates th at financial groups must be organized under the 
common control of a holding company established in Gu atemala specifically for the purpose, or of a 
responsible enterprise belonging to the fi nancial group, which will be the bank. 
106. To incorporate a bank in Guatemala it is necessar y to obtain the authorization of the Monetary 
Board, subject to the prior opinion of the SIB.  Private banks must be set up in the form of a public limited company.  Foreign banks may establish bran ches or subsidiaries or register representative 
offices, solely for the purpose of developing business or  providing financing on Guatemalan territory.  
It is not necessary for the branches of foreign banks to  be administered by a board of directors, as 
required in the case of domestic banks, but at least on e of the officers in charge must be domiciled in 
Guatemala.  The branches of foreign banks are entities that do not possess legal personality independent of that of the parent  bank, of which they form an integral part and which operates in 
another country.  Foreign banks may also est ablish themselves in Guatemala by setting up 
subsidiaries, legal entities with thei r own legal personality independent of  that of the parent bank, but 
in doing so they must comply with the requireme nts, formalities and procedures laid down in the Law 
for setting up a Guatemalan private bank. 
107. The Regulations for the Incorporation of Dome stic Private Banks and the Establishment of 
Branches of Foreign Banks, Decision JM-78-2003, define the time-frames for setting up banks and 
branches of foreign banks, stipulating that on ce the application and corresponding documentation 
have been satisfactorily received the publication of the application shall be ordered within a period of 
15 days and if there are no objections the SIB shall issue its opinion within six months and submit it 
to the Monetary Board, which shall announce its decision within the next 30 days.
51  The bank then 
has six months to commence operations, a period wh ich may be extended by an equal period at its 
request.  For the purpose of assessing the application,  in the case of branches of foreign banks, the 
Law stipulates that, among other aspects, consideration shall be given to whether in the country of the 
parent bank the banking system  is supervised to international standa rds;  whether the supervisor of the 
parent bank consents to the branch in questi on being established in Guatemala; and whether 
institutional information can be exchanged between the two countries' supervisors. 
108. A branch of a foreign bank authorized to operate  in Guatemala can carry out all the operations 
and provide all the services authorized by the Law on Banks and Financial Groups, and the branch 
capital paid in by the parent must be actually recei ved, invested and held in Guatemala.  Branches or 
branch offices of domestic banks, like branch offices of branches of foreign banks already established 
in Guatemala, may be opened, relocated or clo sed without any formalities other than giving the 
SIB written notice at least one month in advance. 
                                                      
51 The text of the Regulations can be viewed on the SIB's website:  http://www.sib.gob.gt/ 
es/normativa/normas_reforma_financieras/Reglamentos/2003-1/JM_78_2003.pdf. Guatemala WT/TPR/S/210/Rev.1 
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109. Foreign banks established in Guatemala, whether through a branch or a subsidiary, like banks 
with domestic capital, are authorized to invest in th e shares of companies that carry out operations of 
a financial nature if they can obtain the approval of  the Monetary Board, subject to the opinion of the 
SIB.  The amount of the investment will depend on the bank's asset position.  The same procedure 
applies to domestic private banks with respect to  their investments in companies that carry out 
operations of a financial nature.  Banking institutions may not invest, either directly or indirectly, in 
companies engaged in commercial, industrial, agri cultural, mining or other activities incompatible 
with their banking vocation. 
110. The Law on Banks and Financial Groups establis hes a minimum capital adequacy ratio of 
10 per cent, weighting the assets according to the associ ated risk.  During the review period, the ratio 
was maintained above the 10 per cent required and thus  above the international standard of 8 per cent, 
reaching 13.2 per cent in December 2007. 
111. The Law also established, in 2002, the Fund for the Protection of Savings, for the purpose of 
guaranteeing depositors in the banking system the rec overy of their deposits.  The Fund pays out up to 
Q 20,000 (some US$2,560) or its equivalent in fore ign currency, per natural or legal person, on 
deposits held in a domestic private bank or a branch  of a foreign bank.  The Fund is financed mainly 
through the compulsory contributions made by dom estic banks and the branches of foreign banks.  
The resources of the Fund for the Protection of Sa vings are administered by the Bank of Guatemala. 
112. A new manual on risk-based supervision and c onsolidated supervision was introduced in 
2008.  According to the authorities, the SIB now h as a set of rules that allow it to examine the 
working documents of external auditors.52  The SIB now requires banks to report on the financial 
situation of their principal debtors; this informati on is held in the Credit Information System and is 
being used by the SIB to strengthen its superv isory functions.  Moreover, the SIB is designing 
specialized control systems to model the effects of  concentration risks on the capital of companies in 
the sector.  The SIB is also working on legisla tion intended to expand its supervisory powers. 
113. Offshore entities are governed by Title XV of  the Law on Banks and Financial Groups and 
the Regulations for the Authorization of the Oper ation of Offshore Entities (Decision JM-285-2002).  
The Law defines them as entities mainly devoted to financial intermediation and established or 
registered under the law of a foreign country, wh ich carry on their activities mainly outside that 
country.  To operate in Guatemala, offshore en tities must obtain authorization from the Monetary 
Board, subject to the opinion of the SIB, and declar e that they form part of a Guatemalan financial 
group.  Offshore entities are subject to the consolid ated supervision of the SIB and the regulations 
against the laundering of money and other assets,  and must consent to this unconditionally and 
irrevocably, in writing. 
114. Offshore entities must furnish any periodic or occasional information requested by the SIB 
and the Bank of Guatemala, and must prove to the SIB that they have authorized the supervisory 
authorities of their country of origin to exchange  information concerning them.  Offshore entities must 
show that the banking regulators in their country of  origin apply international prudential standards at 
least as strict as those in force in Guatemala, relating, among other things, to minimum capital and liquidity requirements.  If not, they will be subject to prudential and liquidity requirements determined 
for such entities by the Monetary Board, at the propo sal of the SIB, which shall be the same as or 
equivalent to those applied to banks established in Gu atemala.  To this end, in 2007, the Regulations 
on Liquidity Reserves for Offshore Entities and the Regulations on Capital Adequacy for Offshore 
Entities, Securities Firms, Enterprises Specializ ing in Financial Services, General Deposit 
                                                     
 
52 Provision contained in the Annex to Decision No. 007-2007 as amended by Decision No. 17-2008, 
both of the Superintendente de Bancos . WT/TPR/S/210/Rev.1 Trade Policy Review 
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Warehouses and Foreign Exchange Houses that form  part of a financial group were issued and 
approved in Monetary Board Decisions JM-85-2007 and JM-200-2007, respectively.  The holding or 
responsible companies of the financial group of whic h the offshore entity forms part must undertake, 
in writing, to cover the capital shortfalls of thei r offshore entities.  Deposits taken by offshore entities 
are not covered by the Fund for the Protection of Savings. 
(c) Insurance 
115. In May 2008, there were 17 insurance compan ies and 11 bonding companies in Guatemala;  
of these, one insurance company and one bondi ng company were State-owned.  As of 
31 December 2007, 13 insurers were carrying ou t assumed reinsurance operations and seven bonding 
companies rebonding operations.  On that date, th e total assets of Guatemala's insurance companies 
amounted to Q 3,600 million (US$472 million), representi ng 2.4 per cent of the assets of the financial 
system subject to supervision, while those of  the bonding companies were slightly higher at 
Q 470 million (US$62 million), representing 0.3 per cent.  These low percentages are attributable, in part, to the pensions system being under the aegis of the public sector.  As  of 31 December 2007, total 
net premiums amounted to Q 3,100 million (US $406 million);  of this total Q 1,900 million 
(US$249 million) corresponded to liability insurance, Q 541 million (US$71 million) to life 
insurance, and Q 648 million (US$85 million) to accident and health insurance.
53  Premiums for ceded 
reinsurance totalled Q 940 million (US$123 million) a nd total net retained premiums Q 2,140 million 
(US$280 million). 
116. The Guatemalan insurance market is regulated by the Ministry of the Economy, the Monetary 
Board and the SIB, in accordance with the Insu rance Law (Decree Law No. 473) of 4 May 1966 and 
its Regulations, which constitute the principal le gislation governing the subsector.  Companies 
interested in operating as insurers must submit a fo rmal request to the SIB, which will examine it, 
verify compliance with the other requirements of the Law and its Regulations and communicate the 
results of its examination to the Ministry of the Economy, which is responsible for approving the 
project to establish the new company.  Once approva l has been obtained, and subject to verification 
by the SIB of compliance with the statutory requi rements applicable, the insurance company may be 
registered in the Register of Insurance Comp anies and commence operations.  The minimum capital 
required to engage in life and liability insurance is Q 3 million for each branch, Q 6 million if the 
company deals in both of these categories, and Q 2 million for other categories of insurance and for 
bonding companies.  Insurance compan ies must also provide and maintain, during the first five years 
of operation, additional capital e quivalent to 25 per cent of the minimum capital required for the 
branches of insurance in which they  operate.  Moreover, each insurance policy and its tariffs require 
the approval of the SIB, which also issu es licences to insurance and bond brokers. 
117. In Guatemala, insurance comp anies, whatever the source of their capital, may only be 
established and organized as public limited companies for the exclusive purpose of operating as an 
insurance company, a reinsurance company or both at the same time and may engage in all branches 
of insurance insofar as they provide the minimum capital required for each branch.  Moreover, under 
the Law on Banks and Financial Groups, they may fo rm part of a financial group led by a holding 
company or a bank acting as the company responsible. 
118. Foreign insurers may incorporate an insuran ce company in Guatemala in accordance with the 
provisions of the Insurance Law and may sell any cat egory of insurance, provided that they comply 
with the above-mentioned requirements, and th e Law does not specify a maximum period for 
                                                      
53 Online information from the SIB.  Viewed at:  http://www.sib.gob.gt/es/ Entidades-Supervisadas/ 
Informacion_de_las_Entidades_Supervisadas/frame.asp?id=/es/entidadessupervisadas/informacion_de_las_ entidades_supervisadas/INFORMACION_TRIMESTRAL/SEGUROS/200712/CUAD5P00.HMT. Guatemala WT/TPR/S/210/Rev.1 
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obtaining authorization to operate as an insurance company.  At the same time, the Insurance Law 
prohibits the establishment of agencies or branch es of foreign insurance companies to develop 
activities related with insurance in general.  Ho wever, in September 2008 Congress was considering 
the Law on Insurance Activity, which updates the legi slation to international standards, including 
authorization of the establishment of branches of fo reign companies, and reinforces the powers of the 
supervisory body. 
119. The Insurance Law stipulates that the following forms of insurance may be taken out solely 
with companies authorized to operate in Guatemala:   personal insurance, if the insured is in the 
country when the contract is signed;  insurance on goods transported from Guatemalan territory into 
foreign territory, if the premiums are paid for th e account of persons legally domiciled or established 
in Guatemala;  and insurance on ships' hulls, aircraft and vehicles of any kind registered in Guatemala and other indemnity insurance against risks to goods located in Guatemalan territory, subject to the 
provisions of international conventi ons and treaties to which Guatemala is party, specifically for the 
cross-border supply of, or trade in, services involvi ng insurance against the risks associated with 
shipment by sea, commercial aviation, space launches,  goods in international transit, and reinsurance 
and retrocession.  The Insurance Law also stipulates th at if insurance companies authorized to operate 
in Guatemala are unable to assume a risk, the interest ed party may request the SIB for authorization to 
take out the insurance with an unauthorized insura nce company.  The SIB must immediately offer the 
authorized insurance companies a hearing, for one working day common to all, and whether they 
respond or not, decide the matter without further formalities on the day following the expiry of this 
one-day period.  Moreover, domestic insurers and bonding companies may sign reinsurance and 
rebonding contracts with foreign companies, provide d that those companies are registered with the 
SIB. 
(iv) Transport 
120. Guatemala has entered into co mmitments under the GATS in air transport, specifically in 
repair and maintenance services, sale and mark eting of transport services, and computerized 
reservation services. 
121. The transport sector is governed by Article  131 of the Constitution, the Transport Law 
(Decree No. 253 of 3 July 1946) and the Civil Aviation Law (Decree No. 93-2000 of 18 December 2000).  Article 131 of the Constitution states that any company offering domestic or 
international transport services requires governmental authorization and that terminals, airports, and 
seaports are public utilities. 
122. Efforts are being made to establish partners hips with the private sector in order, inter alia , to 
promote transport, for example, through the National Competitiveness Programme.
54  T h i s  
programme has led to the development of a Mu ltimodal Transport Plan that envisages action in 
four areas, namely, the road, airport, seaport and public transport systems, involving the 
implementation of multimodal transport that incorpor ates the rural road network.  To ensure the 
continuity of the plan and the necessary follow -up it was proposed that a National Infrastructure 
Commission, composed of users and the public and pr ivate sectors, be set up to examine the priority 
infrastructure projects that will need to be built over  a ten-year period.  However, the authorities have 
noted that the Commission has not been set up and th at a new draft law on infrastructure (the Alliance 
for Development Law) was be fore Congress in August 2008. 
                                                      
54 Additional information can be viewed at:  http://www.pronacom.org/. WT/TPR/S/210/Rev.1 Trade Policy Review 
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(a) Air transport and airports 
123. Guatemala has ten major airports;  the State-owned airports of La Aurora (Guatemala City), 
which handled more than 2.2 million passengers and 102,000 flights in 2007,  and Santa Elena/Tikal 
(Department of Petén) (157,000 passengers in 2007) are the most important.  Although, in practice, all 
the main airports are State-owned, there are no legal restrictions on private ownership.  The 
administration and operation of the airports is also in State hands.  The operation of any airfield must 
be authorized by the Dirección General de Aeronáutica Civil  – DGAC (Directorate-General of Civil 
Aviation).  Maintenance work on Guatamala-regist ered aircraft may be carried out in foreign 
workshops.  The Foreign Investment Law permits pr ivate and foreign participation in air transport 
operations and does not impose any limitations on the number of providers of computerized 
reservation systems, or on the number of travel agencies which the providers of these systems may 
service.  Providers of computerized reservation systems do not need to be established in Guatemala in order to offer their services. 
124. The authorities consider that the improvement and modernization of the airports and airfields 
that make up the National Airport System is esse ntial in order to boost dom estic and international 
tourism, facilitate international trade and reduce ai r fares.  In this connection, in April 2005, 
Guatemala formally began the process of comprehensive modernization of its Airport System, with the main focus on a substantial improvement in infrastructure and operational security.  The main project is the extension, remodelling and moderniza tion of La Aurora intern ational airport, through 
the New Aurora Plan.
55  In June 2007, the airport received final category 1 certification in accordance 
with the international aviation security evaluation classification. 
125. Air transport in Guatemala is governed by th e Civil Aviation Law (Decree No. 93-2000) of 
18 December 2000 and its Regulations, as cont ained in Government Decision No. 384-2001.56  The 
Civil Aviation Law establishes that the DGAC, under the Ministry of Communications, Infrastructure 
and Housing, is responsible for th e regulation of civil aviation and its support services, together with 
airports and related services. 
126. The provision of commercial passenger, freight and/or mail air transport services, or 
combined services, requires the written authori zation of the DGCA, which maintains a National 
Aeronautical Register.  All aircraft entered in this register are deemed to be of Guatemalan 
nationality.  Aircraft registered in another c ountry may acquire Guatemalan registration.  A 
Guatemalan company may lease foreign-owned aircraft , for use inside or outside the country, and 
enter them in the National Aeronautical Register fo r the term of the lease, by purchasing a provisional 
Guatemalan registration, without having to pay im port taxes.  Neither the State nor State-owned 
companies provide any air transport-rela ted services other than airport operation. 
127. The Civil Aviation Law does not lay down any rules concerning the ownership or 
management of international air transport enterp rises;  however, foreign companies must appoint a 
legal representative established in Guatemala. 
128. The Civil Aviation Law contains time limitations on the participation of foreign capital in the 
provision of domestic air transport services, stipula ting that up until January 2004 at least 51 per cent 
                                                      
55 Information available on the DGAC Internet  portal at:  http://www.dgacguate.com/dgac/ 
index.php?option=com_content&task=view&id=54&Itemid=68.  Additional information can be found on the PRONACOM Internet portal at:  http://www.pronacom.org/home/pdf/Informe_Avances_2005-
2006_de_la_ANC_vf.pdf. 
56 The texts of the Civil Aviation Law and its Regulations can be viewed on the DGAC Internet portal 
at:  http://www.dgacguate.com/dgac/. Guatemala WT/TPR/S/210/Rev.1 
 Page 99 
 
 
of the capital must be held by Guatemalans.  Th ereafter companies offering domestic air transport 
services may be wholly foreign-owned.  In additi on, cabotage companies must have their principal 
domicile in Guatemala, and at least half plus one of their executives and directors must be Guatemalan nationals or reside permanently in Guatemala.  The Law also stipulates that in 
commercial operations carried out by domestic  airlines, the personnel performing on-board 
aeronautical functions must be Guatemalan.  For technical reasons, the DGAC may authorize foreign personnel for a renewable period of not more than three months, if it can be shown that there are no qualified personnel available in Guatemala. 
129. Fares and freight rates for domestic air transport services are set freely by the carriers, in 
accordance with market conditions and the criter ia of supply and demand for the services.  
International fares are set in accord ance with the provisions of the international agreements to which 
Guatemala is party.  Exceptionally and for reas ons of national interest or public necessity, the 
DGAC may fix minimum and maximum fares for domestic or international air transport. 
130. As of August 2008, the DGAC had finalized thre e draft laws to facilitate future private 
participation in infrastructure.  These included a new law on the establishment of an autonomous 
airport authority, another for the creation of airpor t operator company ownership status, and a revised 
version of the Civil Aviation Code to accommodate the new laws.  At the time, these laws were being 
scrutinized by a parliamentary transport committee. 
131. With respect to international commercial air services, scheduled and non-scheduled, 
Guatemala grants all countries the third, fourth and fifth freedoms of the air,  in accordance with the 
Chicago Convention of 1944.  Guatemala has signed  bilateral agreements on air transport services 
with nine countries (Belgium, Chile, Ecuador, Fr ance, Germany, Mexico, Netherlands, Spain and 
Switzerland).  It has also negotiated open skies agreements with the United States (1997), with 
Panama (1998) and with Chinese Taipei.  All the agreem ents listed are in force.  In the absence of an 
agreement, the provision of international air transport services is subject to the principle of reciprocity 
and this principle is applied through Guatemala's ope n skies policy.  There are some air links that are 
not covered by a bilateral agreement, but in these cases the reciprocity principle is applied. 
(b) Maritime transport and ports 
132. Guatemala has four certified ports which, together with specialized terminals, every facility 
with a vessel-port interface, and the providers of port services, make up the Sistema Portuario 
Nacional  – SPN (National Port System).  The main ports are Puerto Santo Tomás de Castilla and 
Puerto Barrios on the Atlantic coast and Puerto Quet zal and Puerto San José on the Pacific side.  It is 
estimated that 78.7 per cent of Guatemala's in ternational trade flows through its seaports.
57 
133. All the ports in Guatemala are State-owned.  Puerto Barrios, put out on concession for 
25 years in 1990, is the only port under private administration.  The other two main ports are administered by State institutions.  In Puerto Quetzal , some services (in particular, loading) have been 
given out on concession.  During 2006, Puerto Quetzal, operated by Empresa Portuaria Quetzal, 
moved a total of 7.1 million tonnes, a slight increase on the previous year;  1,200 vessels were serviced.  Private sector participation is least in Sa nto Tomás, which is operated by Empresa Portuaria 
Nacional Santo Tomás de Castilla (Empornac).  In  2006, the port of Santo Tomás moved a total of 
4.6 million tonnes, an increase of 7 per cent over 2005;  43 per cent of cargo was transported in containers, followed by 32 per cent as liquid bulk.  Altogether, 1,435 vessels were serviced.  A new 
                                                     
 
57 CPN (2008), p. 35/36. WT/TPR/S/210/Rev.1 Trade Policy Review 
Page 100 
 
 
container terminal is being developed, as a public-pri vate joint venture, together with a new pier for 
cruise ships.58 
134. Guatemala does not have a national merchant fl eet or companies providing maritime transport 
services under foreign flags.  According to the auth orities, a draft law currently being examined in 
Congress envisages the possibility of establishing a national merchant fleet, but no concrete plans 
have yet emerged.  In practice, foreign vessels ar e authorized to provide domestic cabotage services;  
Guatemala's national legislation does not contain any explicit prohibitions or authorizations in this 
respect.  There are no restrictions on foreigners wa nting to operate ports or  provide auxiliary port 
services, such as pilotage, towing, cargo handling and warehousing.  The Navy maintains a register of 
merchant ships. 
135. The commercial aspects of mar itime transport are governed by the third book of the 
Commercial Code.  Guatemala does not have a speci fic law on maritime transport, nor are there 
specific regulations on shipping in the Transport Law.  However, there is legislation that affects various aspects of maritime transport, in particul ar in relation to ports, su ch as Article 131 of the 
Constitution and Decree No. 114-97 on consumer pr otection, the promotion of competition and the 
legal repression of unfair competition. 
136. The policy guidelines and strategic objectives for maritime services are contained in the 
National Maritime Port Policy launched in 2006.  This  policy is aimed at modernizing the ports and 
adapting them to ensure greater protection of the environment and maritime areas and increased efficiency.  The policy has six components:  modernization of port and maritime legislation;  creation 
of a maritime port authority;  modernization and ha rmonization with international standards in matters 
relating to maritime safety;  modernization and harmonization in relation to the plans for 
environmental management within the port system, protection of the environment and maritime areas;  
generation of mechanisms for strengthening the ba rgaining power of users of port and maritime 
services, as a means of making the fees for these se rvices more competitive;  and the improvement 
and promotion of the administrative efficiency of the supply chain.  The preliminary draft Maritime 
Port Authority Law, which seeks to ensure legal certainty for private participation in the port 
subsector, has been developed within this framework. 
137. The Ministry of Communications, Infrastructur e and Housing has general responsibility for 
the formulation of Guatemala's seaport policies.  The Comisión Portuaria Nacional  – CPN (National 
Port Commission), whose board is composed of repr esentatives of various ministries, the main public 
port enterprises and the private sector, plays a main ly advisory role.  The CPN proposes measures to 
modernize and improve the efficiency of the SPN.  According to the authorities, in September 2008 
there was a draft law before Congress, which was c onsidering the establishment of a regulatory, but 
not administrative, port authority.  The draft law also envisages the creation of a national merchant 
fleet and contains concrete specifications c oncerning the requirements for building a port.  
Recognizing that current freight rates are relati vely high, the authorities consider that the 
establishment of a regulatory port authority would make it possible to reduce maritime transport costs by regulating them. 
138. Guatemala has been a member of the International Maritime Organization since 1983 and has 
signed several international maritime transport conventions.
59  Guatemala has not concluded any 
                                                      
58 PRONACOM (2008). 
59 Guatemala has signed the International Convention on Civil Liability for Oil Pollution Damage, the 
International Convention relating to Intervention on the High Seas in Cases of Oil Pollution Casualties, the United Nations Convention on the Law of the Sea, the International Convention for the Prevention of Pollution Guatemala WT/TPR/S/210/Rev.1 
 Page 101 
 
 
cargo-sharing arrangements with other countries, nor is it a party to the UNCTAD Liner Code.  
Guatemala is also a member of the Cent ral American Maritime Transport Commission 
(COCATRAM), a technical body that advises memb er governments on the formulation and adoption 
of policies, recommendations and decisions in the various areas of the transport sector. 
139. The Government has devoted resources to improvi ng the security certification of Guatemala's 
seaports to adapt them to international standard s.  Attention has been focused on improving the 
efficiency of operations in the Port of Santo Tomás.  A World Bank study recommends a series of 
measures to make Guatemala's ports more effi cient.  One recommendation is for less political 
interference in the ports under public administ ration through greater user (private sector) 
representation on the executive boards and the modern ization of the public port management process, 
with an emphasis on human resources, productivity and transparency.  The implementation of institutional and legislative reforms to facilita te private participation is also recommended.
60 
140. In addition, the CPN has been ta king steps to comply fully with the security provisions of the 
SOLAS Convention and the International Ship and Po rt Facility Security Code (ISPS Code).  In the 
latter case, the CPN has sought the support of nationa l institutions specializing in protection aspects in 
the process of implementing the ISPS Code and has decided on the following coverage:  
(a) certification with the International Maritime Or ganization (IMO) of the three main ports:  Santo 
Tomás de Castilla and Puerto Barrios in the Caribb ean and Puerto Quetzal on the Pacific coast, with 
the appointment of a Protection Officer in each port;  (b) IMO certification of the seven specialized 
terminals operated by the private sector within the limits of Puerto Quetzal (this process ended in 
November 2004);  (c) authorization for 33 enterprises to operate port services subject to a declaration 
of compliance;  as of September 2008, there were  only a few enterprises still awaiting authorization.61 
(v) Professional services 
(a) General characteristics 
141. In Guatemala, professional services are governed by the Ley de Colegiación Profesional  (Law 
on Enrolment in a Professional Association) (Decree No. 72-2001).  The Law recapitulates the 
provisions of Articles 34, 90 and 105 of the C onstitution and stipulates that university-level 
professionals must belong to a professional associ ation or "college".  The Law requires the 
universities to provide each professional association, in  January and June each year, with a list of the 
professionals who have graduated during the period, with the corresponding statutory particulars.  The 
qualifications awarded by Guatemalan universities, or acceptance of the recruitment of professionals 
graduating abroad, authorize the exercise of a profession academically but not legally, legal 
authorization depending on admission to the corresponding professional association. 
142. The Assembly of Presidents of the Professional Associations of Guatemala maintains a 
register of the various professions and coordinates their policies.  The Assembly is organized in 
accordance with the Law on Compul sory Enrolment in a Professional Association.  The Assembly of 
Presidents is a collegiate body composed of all the Presidents of these Professional Associations.  
Their term of office is two years.62 
                                                                                                                                                                     
from Ships (MARPOL), the International Convention for th e Safety of Life at Sea (SOLAS), the International 
Convention on Load Lines, and the Convention on Facilitation of International Maritime Traffic. 
60 World Bank (2004), pp. 60-61. 
61 CPN information.  Viewed online at:  http://www.cpn.gob.gt/codigo_pbip.htm. 
62 In mid-2008, the Assembly of Presidents was composed of the presidents of the following:  College 
of Attorneys and Notaries of Guatemal a;  College of Architects of Guatem ala;  College of Certified Public WT/TPR/S/210/Rev.1 Trade Policy Review 
Page 102 
 
 
143. Guatemalan and foreign professionals possessing a qualification or diploma from a foreign 
university must have it revalidated in Guatem ala, under the procedure for the recognition of 
qualifications established by the University of San Carlos de Guatemala, the only national university 
empowered to grant recognition.  All documents required for the revalidation procedure must be 
authenticated by the Guatemalan diplomatic or cons ular authorities accredited to the country of origin 
and by the Foreign Ministry.  Once a degree has been revalidated, the ho lder may enrol in the 
corresponding professional association. 
144. If a qualification or diploma has been obtaine d from a foreign university with which a 
Guatemalan university has an agreement, no revalid ation examination is requi red, and revalidation is 
automatic when the qualification is from a nationa l university of another CACM country.  Where 
university professions are concerne d, the qualification obtained must be registered with the 
corresponding professional association for the holder to qualify and be able to practise lawfully the profession in question.  In other cases it is n ecessary to pass a revalidation examination. 
145. Guatemala has signed the Protocol to the Ge neral Treaty on Central American Economic 
Integration (Guatemala Protocol) of 29 October 1993, under which the parties agreed to harmonize 
their legislation in order to allow the free exercise of university-level professions  in any country in the 
region.  Guatemala has not subscribed to any sp ecific commitment relating to professional services in 
its GATS Schedule.  Guatemala has not notified its regulations on regulated professions to the WTO. 
(b) Legal services 
146. To act as an attorney it is necessary to hold a certificate of competence issued by the Supreme 
Court of Justice and be registered with the College of Attorneys and Notaries.  To obtain a certificate 
the following requirements must be met:  the appli cant must be a Guatemalan national and have a 
professional qualification in law awarded by a recognized university.  To practise as a notary it is necessary to be Guatemalan by birth, to be legally  resident in Guatemala and to have obtained a 
professional qualification.  Under the terms of in ternational agreements, foreign attorneys may 
provide consultancy services exclusively in relation to international law and the legislation of the 
jurisdiction in which the foreign attorney is qua lified.  The consultancy services may not include 
appearing before the tribunals, cour ts or judicial authorities.  Law may not be practised through public 
limited companies. 
(c) Accounting services 
147. To exercise the profession it is necessary to hold a licence issued by the College of 
Accountants of Guatemala.  To obtain a licence applicants must be university graduates and duly 
enrolled in the relevant professional association (L aw on Enrolment in a Professional Association);  it 
is not necessary to be a Guatemalan national or r esident.  Since its foundation, on 1 June 2005, the 
                                                                                                                                                                    
 
Accountants and Auditors of Guatemala;  College of Economists, Certified Public Accountants and Auditors 
and Company Managers;  College of Dentists of Guatemala;  College of Pharmacists and Chemists of 
Guatemala;  College of Agronomists of  Guatemala;  College of Engineers of  Guatemala;  College of Chemical 
Engineers of Guatemala;  College of Doctors and Surgeons of Guatemala; College of Veterinary Surgeons and 
Animal Husbandry Specialists of Guatemala;  and the Professional College of Humanities of Guatemala.  
Online information provided by the Assembly of Presidents, at:  http://asambleadepresidentescolprof.org/asamblea.html. Guatemala WT/TPR/S/210/Rev.1 
 Page 103 
 
 
College of Certified Public Acc ountants and Auditors of Guatemala has been an association, with 
legal personality, for accountancy professiona ls from Guatemala's various universities.63 
148. Only certified public accountants properly licen sed in Guatemala may set up companies to 
provide accounting services.  Such companies are allo wed to enter into part nerships with foreign 
firms. 
(d) Architectural and engineering services 
149. To practise as an architect it is necessary to hol d a licence issued by the College of Architects 
of Guatemala.  To obtain a licence applicants must  be university graduates and duly enrolled in the 
relevant professional association (Law on Enrolmen t in a Professional Associ ation);  it is not 
necessary to be a Guatemalan national or resident.  The Law on Enrolment in a Professional 
Association and the Law concerning the Stamp Duty  on Architecture, Decree No. 67-76, govern the 
exercise of the profession of architect.  The second of these laws establishes a stamp duty on architecture, to be paid by members of the Colle ge of Architects of Guatemala and companies whose 
purpose is the practice of architecture, urban mana gement, town planning or building.  The duty 
amounts to 1 per cent of the fees that the architect receives or of the monthly salary of the 
architectural professional in the case of national professi onals or 2 per cent of earnings in the case of 
foreign professionals authorized to o ccupy posts in national institutions. 
150. There are three professional associations in the fiel d of engineering:  the College of Engineers 
of Guatemala, the College of Chemical Engineers and the College of Agronomists.  To exercise the 
profession it is necessary to hold a licence issued by  the corresponding College of Engineers.  To 
obtain a licence the applicant must be a universit y graduate and duly enrolled in the relevant 
professional association (Law on Enrolment in a Professional Association);  it is not necessary to be a Guatemalan national or resident. 
151. The College of Engineers of Guatemala is a non-profit professional association, with legal 
personality and its own assets, open to all engi neering professionals working in the various 
specializations and related branches.  The College  of Chemical Engineers of Guatemala is the 
association to which it is necessary to belong in  order to exercise the profession in the case of 
chemical engineers, textile engineers, geologi sts, petroleum and petrochemical engineers, 
biochemical, biotechnological, biogenetic and biomedi cal engineers and other related branches.  To 
enrol, professionals graduating abroad must obtain legal authorization to exercise the profession in 
Guatemala, in conformity with international treaties accepted and ratified by Guatemala.
64 
152. Architecture and engineering programmes are granted Central American regional 
accreditation through the Agencia Centroamericana de Acreditaci ón de Programas de Arquitectura y 
de Ingeniería  – ACAAI (Central American Agency for the Accreditation of Architecture and 
Engineering Programmes), a regional organization formed by Belize, Costa Rica, El Salvador, 
Guatemala, Honduras, Nicaragua and Panama.  The ACAAI grants ac creditation to programmes in 
architecture and related subjects and to programmes in engineering and its various specializations 
offered by higher education institutions opera ting in the individual countries or the region.65 
 
 
                                                      
63 Statutes of the College of Certified Public Accountants and Auditors of Guatemala.  Viewed at:  
http://www.cpa.org.gt/estatutos.pdf. 
64 Viewed at:  http://www.iqgua.org/reglamento.html. 
65 ACAAI online information viewed at:  http://www.acaai .org.pa/estatuto1.html. Guatemala WT/TPR/S/210/Rev.1 
 Page 105 
 
 
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